One of the most popular selling points to cord cutting has been the fact that you don’t pay all the same taxes as you would if you had cable TV. Now a growing number of governments want to create new taxes that target cord cutters to help replace the lost revenue from cord cutting.
Recently the State of New York announced plans to tax streaming services to help fund the subway system in New York City. In other areas, local governments in Texas, Nevada, and more have passed or proposed local taxes on streaming services to help offset the drop in revenues from cable TV companies.
Chicago was the first city to launch a so-called “amusement tax” that added a 9% fee to streaming services back in 2015. According to Bloomberg, Chicago collected more than $30 million for streamers in 2021.
The US is not the only place that wants to tax streaming. Canada is currently looking at taxing foreign internet platforms to subsidize locally produced content in Canada.
In the UK, there is a draft bill that would have online services that would find streaming services for harmful material up to about $312,000 if they broke the rules, according to a report from The Hollywood Reporter.
For now, there have been no successful or even serious pushes to make a national US streaming tax. Some do expect attempts to tax streaming in the future, but for now, it has yet to happen.
Increasingly cord cutting is impacting not just cable TV companies but local governments that rely on revenue from taxes on cable services. The question is how widespread these efforts will be to create special taxes targeting streaming services.
Do you think local governments should be able to create special taxes on streaming services? Leave us a comment and let us know what you think.