Early today the Commonwealth of Virginia’s legislature shot down an attempt to tax streaming services like Netflix and Spotify. Even the legislator who introduced the bill voted to defeat the Netflix tax.
According to the Virginia Pilot, Virginia House Delegate Vivian Watts thought her bill would be a good way to spark conversation about tax reform.
The bill would have extended an existing tax on telephone infrastructure to the internet infrastructure used to deliver streaming services, adding fifty cents to the price of a Netflix subscription.
The committee’s unanimous opposition to the bill means the new tax won’t see the light of day. However, the problem the bill sought to address remains.
Streaming services have like Netflix and YouTube have achieved mainstream popularity, but legislators aren’t sure how they should be taxed.
Tax revenues generated from landlines and cable companies are decreasing. The shift away from wired phones to wireless, combined with cord-cutting, means less income for local governments.