The people of Pasadena, California were none too pleased when they heard the news of a 9.4 percent streaming tax being possibly added to their Netflix, Hulu and other streaming services bill. The city council is claiming that streaming video is a utility and should be taxed like water and electricity. Although this is extremely hard to swallow, they’re claiming the tax is designed to make up for lost tax revenue with people canceling their cable TV and home phone services.
However, this could present legality issues as the Internet Association Director Robert Callahan has pointed out that the federal government doesn’t allow taxes on the Internet. “Utilities are water, and electricity, and sewer and all sorts of other utilities. Websites and apps don’t fit that mold whatsoever,” Callahan said.
This has not stopped other cities from implementing this suspicious tax, however. The city of Chicago is being sued for a 9 percent tax that they placed on their citizens streaming bill. Pennsylvania charges a 6 percent sales tax on everything that goes on through the Internet, including apps and downloads. They’re doing it to close a $1.3 billion budget gap, but they’re being sued as well. To read more, click here.
Taxing us for our right to stream television online? Let’s hope this doesn’t become trendy with lawmakers. What are your thoughts? Let’s discuss below!
– Janiera Eldridge
Follow me on Twitter @janieraeldridge