American Cities Impose ‘Netflix Tax’ to Make Up for Lost Cable Revenue


Pasadena City officials are about to introduce the new tax that will equate paid streaming-video services to utilities like water and electricity. The tax was designed to counteract the loss of old-fashioned cable TV and home phone revenue.

City authorities have long discussed the tax, and are not the first to implement it. Chicago introduced 9-percent tax, known as the “cloud tax,” extending the amusement tax to online services, including Netflix, Amazon, Spotify, and others. This tax is not to be confused with taxes on cloud-computing services, or “nonpossesory computer leases.”

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