As more people ditch cable TV more cities are seeing dropping tax revenue. Now more and more cities are deciding to fight back by adding new taxes.
This started when Chicago added a tax to all streaming services with subscribers living in Chicago. Slowly more cities have started to add taxes, and now even more cities are looking at adding a so-called Netflix tax on all streaming services including music streaming services.
Now Pasadena, California, has announced that they will start to apply a 9.4 percent tax on “video services” to subscribers of streaming video providers such as Netflix, HBO Go, and Hulu. The tax begins January 1, 2017.
“As companies begin to provide services that look more and more like cable services, those fall under taxable services,” Maynor said. “There will be a whole bunch more that will be adopting them in a couple of months.”
At least with Pasadena, they are only adding the tax to video services unlike other cities. So far no services have tried to change the tax and are unlikely to do so.
The real losers here are people who subscribe to both pay-TV providers and Netflix as do an estimated 50 million Americans. Not only are they being taxed on their cable subscriptions, but they are also being taxed on their streaming services.
If you are unhappy about the tax make sure to reach out to your elected representatives. Make your voice heard because, in the end, your representative is accountable to the voters.
Source: Pasadena News
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