A group at the Minnesota state capitol is pushing for big tech companies to pay their fair share when it comes to digital ad sales and services.
"We Make Minnesota" says the tech sector is largely exempt when it comes to paying state sales taxes.
Minnesota Governor Tim Walz supports the proposal, and says big tech companies need to pay their share for those services.
"These social media companies, and as you know they datamine us and then they take that data and they sell it to advertisers," Walz said on the WCCO Morning News. "And that's why when you're looking at something, if you happen to stay too long on a website and you're looking at a new pair of shoes, you're going to get a bunch of ads for shoes. They're making money on every single one of those, but they're not taxed on it. If it were any other commodity, they would be taxed on it. And what we will be able to do, and this is not coming out of the individuals, this is not taxing people for using it, but it's a recognition that the wealth and the power concentrated in these social media companies, they need to pay back."
Minnesota musician Sunshine Parker says he made just under $5 from his music streaming on Spotify last year.
"These platforms benefit themselves, the giant record labels that have stake in streaming services, and the very few famous artists in the world," Parker said Wednesday. "Meanwhile, the rest of us are working multiple jobs just to keep creating the music that fills their platforms."
The group says ending the sales tax exemption would add hundreds of millions of dollars to the overall state budget.
"It's pretty clear that Minnesotans are paying their fair share of taxes when billion dollar corporations are not," adds DFL Representative Liz Lee says. "This bill is intended to fix that so that we have the funding we need to invest in schools, healthcare, infrastructure, childcare, local government, and to improve the lives of all Minnesotans."
Lee says the bill would raise more than $300 million in revenue, while cutting the overall state sales tax.
House Republican Speaker Lisa Demuth is not in favor, saying the proposal was something that was brought forward in the tax bill last year. She said they need to look at cuts, not an increase in taxes.
"What we are saying is there has to be other ways we can cut spending at a state level before we start raising taxes in different areas, different businesses, or on Minnesotans," Demuth said on the WCCO Morning News Wednesday. "Again, our state budget increased in '23 and '24, increased another $10 billion in addition to that surplus, the $18 billion surplus that we had before. So the government has been raising the budget, raising fees, raising taxes on all Minnesotans, and yes, we need to stop fraud and find the savings that's there, but we also need to find ways that we are cutting government spending overall. That is where we are looking for savings instead of just automatically fees and taxes."
