The streaming sales tax on intangible services is ironic and dangerous

Credit: PXFuel

If you subscribe to premium services like Netflix, Hulu, Disney+ et al, expect to pay more soon. There is a 6% sales tax exclusively for streaming which is already active across half the country. For those not currently paying, your state is pushing for it so expect to be paying another tax soon.

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How much should I be worried in dollars?

In the grand scheme of things, 6% on Netflix’s $15 monthly fee is $0.90. It isn’t a big deal, and even with several premium streaming services ,you’ll end up only paying an extra $5 to $10. The good thing about streaming is that it’s easy to cut a service. However, paying even $0.90 is ironic.

streaming sales tax
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The irony of the sales tax

The sales tax has never impacted intangible goods and services before, but because of the popularity of streaming, the government wants in. If these taxed funds end up improving education, the police and fire services, it’s worthwhile, yet it still leaves a horrible taste in the back of my mouth.

Why is this sales tax enforced on us while behemoth tech and entertainment companies pay nothing at all?

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The dangers of an intangible services tax

This nickel-and-diming of consumers is illogical when massive companies get away with paying nothing in taxes. Putting that aside, the issue is that politics is a divisive topic, one we don’t want to get entangled with. Instead, we’re concerned by what gets taxed next.

Streaming is a simple technical pastime, just like social media, online gaming, and other digital distractions. If a state can tax Netflix, how long until they tax our other digital subscriptions and transactions, from online gaming to SaaS?

At the end of the day, if every intangible service is hit with a 6% tax, it will become a huge monthly burden.

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