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Tax Law

The 2020 State Legislative Trend to Watch – Advertising and Data Taxes

Over 40 state legislatures have convened their 2020 legislative sessions. Last year, states moved quickly to impose collection and remittance obligations on remote sellers and marketplace facilitators in light of Wayfair. This year, states are charting a new course – proposing legislation to expand sales taxes to include advertising services or proposing entirely new taxes on advertising and data. Currently, tax proposals are percolating in:

  • Maryland proposes an entirely new gross receipts tax on gross revenues earned from online advertisements (SB 2 & HB 695)
  • Nebraska proposes to expand the sales and use tax base to include online advertisements (LB 989)
  • New York proposes an entirely new tax on gross income corporations derive from the data individuals share with corporations (AB 9112 & SB 6102)
  • South Dakota proposes to subject advertising services to sales and use taxes (HB 1284)

As states often adopt proposals considered by sister states, we expect additional tax proposals. Buckle up.