A Republican state legislator in Missouri has sponsored a bill intended to stop cities and other local jurisdictions from imposing taxes and fees on Netflix and other streaming companies.
“A ‘Netflix tax’ would raise costs for Missouri families, limit consumer choice, and hinder economic growth,” wrote Rep. Ben Keathley in a Missouri Times op-ed piece, explaining House Bill 2057.
“Franchise fees are a way for cities to recoup costs from traditional video providers, like cable and phone companies, from digging up streets, laying or hanging wires and accessing rights of way,” Keathley added. “It makes no sense to impose franchise fees on streaming. These services are accessed over the internet. Therefore, there is no impact on cities’ infrastructure.”
Claiming he’s familiar with the “bottomless appetite” of local governments for “more revenue,” Keathly also said that his bill has drawn support from a number of “taxpayer advocates,” including Americans for Tax Reform president Grover Norquist.
Silicon Valley streaming companies are getting help from Heartland-situated small-government-focused conservative politicians as they fight state and local taxes on numerous fronts … and in some cases, just give in.
Earlier this week, Netflix sent an email to its subscribers in Florida, informing them they'd have to pay an additional “state communications tax” surcharge, which adds up to 5.07% of their monthly service charge.
According to online sales tax resource Accurate Tax, Florida, North Carolina, Pennsylvania and Washington currently tax streaming services under existing state sales-tax laws. And Netflix generally hasn’t pushed back against this method in the same way it has with state and local governments that try to lump streaming in with telecom services.
But that may be starting to change.
In late January, Netflix told a state court in Colorado that its services should not be subject to sales taxes. Colorado has been collecting sales taxes on streaming since 2021. Netflix is arguing that the taxes violate federal laws protecting electronic commerce.
