July 21, 2000

OTTAWA-HULL — Today, the Canadian Radio-television and Telecommunications Commission (CRTC) approved a proposal by MTS to increase local residential telephone rates by $3.00 as well as various increases in other service rates to recover income tax expenses. The CRTC has approved this rate on an interim basis, effective August 1^st, 2000 and has initiated a proceeding to examine in detail the exact amount MTS will require to recover income tax expenses incurred for the years 2000 and 2001.

Although the CRTC denied MTS' request in 1999 to pre-collect income tax expenses from local residential subscribers, it did conclude that once MTS incurred this expense it would be considered as a cost to the telephone company and therefore considered in the rate scheme, as is currently the case with other Canadian telephone companies.

Reference documents: Public Notice CRTC 2000-108, Order CRTC 2000-677 and Telecom Decision CRTC 99-2.

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Copies of today’s documents are available through our Internet site ( http://www.crtc.gc.ca ) or by contacting the public examination room of any CRTC office. These documents are available in alternative format upon request.