ANA Opposes Proposed Digital Ad Tax in Connecticut


ANA Opposes Proposed Digital Ad Tax in Connecticut 

Washington D.C. (March 15, 2021) – On Friday, ANA submitted testimony to the Connecticut Joint Committee on Finance, Revenue, and Bonding in opposition to SB 821, a proposed digital ad tax. If passed, SB 821 would “establish a 10 percent tax on the annual gross revenues derived from digital advertising services in the state for any business with annual world-wide gross revenues exceeding $10 billion.” 

The following is a statement from Dan Jaffe, ANA’s Group EVP, Government Relations: 

“Advertising is a key driver of the economy, representing 17.5% of Connecticut’s economic output according to economic research for the media and advertising industries that applied an economic model developed by the 1980 Nobel Laureate for Economic Science, Dr. Lawrence R. Klein. This proposed digital ad tax would undoubtedly be passed on to consumers and Connecticut’s small businesses. Placing a burden on the effort to sell, as businesses struggle to cope with the impact of the COVID-19 pandemic, is simply a bad idea.  

In addition to the negative economic impacts of the proposed tax, there are also legal and constitutional concerns. This tax would certainly be considered in violation of the Permanent Internet Tax Freedom Act (PITFA) because of its discriminatory nature. The tax is also likely to violate the Dormant Commerce Clause of the Constitution and the tax’s singling out of digital commercial speech raises serious First Amendment Concerns.” 

Jaffe added, “ANA will continue to fight any attempt to tax advertising and we strongly urge Connecticut legislators to reject SB 821.” 

The mission of the ANA (Association of National Advertisers) is to drive growth for marketing professionals, brands and businesses, the industry, and humanity. The ANA serves the marketing needs of 20,000 brands by leveraging the 12-point ANA Growth Agenda, which has been endorsed by the Global CMO Growth Council. The ANA’s membership consists of U.S. and international companies, including client-side marketers, nonprofits, fundraisers, and marketing solutions providers (data science and technology companies, ad agencies, publishers, media companies, suppliers, and vendors). The ANA creates Marketing Growth Champions by serving, educating, and advocating for more than 50,000 industry members that collectively invest more than $400 billion in marketing and advertising annually.

Dan Jaffe
Group EVP, Government Relations, ANA
Phone: 646.369.4886