PHILADELPHIA (KYW Newsradio) — A Philadelphia Democrat in the State House wants to tax digital advertising, saying the richest companies in the world are raking in hundreds of billions of dollars with no benefit to Pennsylvanians.
The bill from State Rep. Elizabeth Fiedler would update Pennsylvania’s gross receipts tax to include revenue from digital advertising.
“The proposed legislation before you today could bring in between 300 and 600 million in revenue in just one year. Imagine the good work that that money could go to in all of our districts,” Fiedler said.
The House Finance Committee held a hearing on the bill, with California law professor Darian Shanske saying Meta, Google, TikTok, Microsoft and Amazon pull in around 90% of what’s projected to be a trillion-dollar business in the coming years without paying taxes. Shanske calls it “an enormous advantage in a natural monopoly.”
“This is exactly what you'd expect to see, and exactly why these are the kind of industries that are subject, or should be subject to, the state's gross receipts tax,” Shanske said.
For example, Shanske said if you buy a book of maps in Pennsylvania, you pay sales tax, but if you trade your personal data to allow advertisement sales through Google Maps, no tax is collected.
The companies have sued Maryland over a similar tax enacted in 2022, but Shanske says while there are potential issues with Maryland’s version, Pennsylvania putting it under an existing tax should hold up in courts.
Fiedler’s bill is awaiting a vote in the House Finance Committee.
She says it could bring between $300 and 600 million in revenue in just one year
She says it could bring between $300 and 600 million in revenue in just one year
