A Netflix Tax is not new. Chicago has been charging one for some time, but now other areas are looking to institute a Netflix Tax. Pennsylvania has started to charge a 6 percent sales tax on all digital subscription services, such as Netflix, and downloads such as books and movies.
Pennsylvania is hoping the new digital tax will help close a $1.3 billion shortfall in the states $31.5 billion budget. The new tax is now in effect and will be charged to anyone with a billing address in Pennsylvania.
The tax goes as far as taxing ringtones and apps that charge a fee. No statement at this time has been released from Netflix on this new tax, but Netflix made no effort to fight back on the Chicago tax after it was passed.
Other states are watching closely because they also would like to raise funds to replace lost revenue from fewer people subscribing to cable TV. For now, no other state has passed a bill to tax digital services such as Netflix.
As more states have won their fight to tax Amazon, many are now turning their sights to other online sources of tax revenue.
Once a tax is passed it is difficult to fight back against it, so make sure to keep your eyes and ears open to find the tax before it passes if you want to try and stop it.
Source: CBS News
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