If you’ve ever used your smartphone or tablet to buy and download a digital good or service, such as an app, music, movie, e-book, video game, etc., then you’ll want to pay attention. When it comes to how you’re taxed for those purchases, the rules are really messy.
Right now it’s possible you could be taxed by several different jurisdictions for the same digital purchase. For example, let’s say you pay your wireless service bill in one area code, but you buy something with your device when you’re in another one, from a company in yet another part of the country. Under today’s tax regulations, it’s possible you can be taxed by all three jurisdictions!
With state and local governments desperate for new revenue sources, that scenario is quite possible, and there’s currently no law in place to keep that from happening. That’s why it’s important to make sure wireless consumers are treated fairly and that all of us have a reasonable and sensible tax structure for such purchases.
Fortunately, Senators Ron Wyden (D-OR) and John Thune (R-SD) stepped up for wireless consumers today by introducing the ‘Digital Goods and Services Tax Fairness Act’ (S. 1364). This bill would prevent digital goods and services purchases from being subjected to multiple and discriminatory taxes.
This bipartisan federal legislation would establish a national framework for how this growing digital marketplace should be fairly taxed at the state and local levels.
Time for Action
Let’s take action now before this messy patchwork of state tax laws gets any worse!
Please write your Senator today to ask them to support the swift passage of the ‘Digital Goods and Services Tax Fairness Act’ and to urge them to ask their colleagues in the House to do the same.