Chicago: "amusement tax" and "personal property tax" for Netflix and cloud services

[Deleted]

"The amusement tax applies to charges paid for the privilege to witness, view or participate in an amusement," states the city's new ruling (pdf).

"This includes not only charges paid for the privilege to witness, view or participate in amusements in person but also charges paid for the privilege to witness, view or participate in amusements that are delivered electronically."

Sources:
- http://www.dslreports.com/shownews/C...lix-Tax-134367
- http://www.chicagotribune.com/news/l...701-story.html
- http://www.theverge.com/2015/7/1/887...etflix-spotify

Netflix service in Chicago is about to get notably more expensive [ed. 9%+ tax]. On the hunt for new revenue, Chicago's Department of Finance is applying two new rules that would impact companies like Netflix and Spotify. One covers "electronically delivered amusements" and another covers "nonpossessory computer leases"; together they form a unique and troubling new attempt by cities to tax any city resident that interacts with "the cloud. According to the Chicago Tribune, streaming service providers need to start collecting the tax starting September 1.

The new tax is expected to net the city of Chicago an additional $12 million annually.

The expansion of the amusement tax does not apply under this new interpretation to music, movies or games that are bought electronically, such as individual albums, songs or movies bought on iTunes.

A Netflix spokeswoman confirmed that the company will pass the additional cost onto subscribers but said no other details were available.
...
He expressed concern that the tax expansion, applied in a city already known for high taxes and fees, could be enough to push residents and companies to find ways to dodge them. Since the taxes will be levied based on Chicago billing addresses, Wynne said there's nothing to stop people and businesses from moving outside the city limits or listing billing addresses in other towns.

"Let's say I sign up for streaming business data in the city but I have offices throughout the country," Wynne said. "I will definitely make sure my billing goes through a different office."

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The past five years have seen a huge shift in the way we consume media, as brick-and-mortar stores shift to digital subscriptions. It's been a valuable tradeoff for some, building billion-dollar companies and unlocking huge libraries of music and video for relatively paltry subscription fees, but it's also been a challenge for cities that rely on those businesses for revenue. Now, Chicago wants to take back those missing taxes, and the way it's retaking them has some lawyers up in arms.

Today, a new "cloud tax" takes effect in the city of Chicago, targeting online databases and streaming entertainment services. It's a puzzling tax, cutting against many of the basic assumptions of the web, but the broader implications could be even more unsettling. Cloud services are built to be universal: Netflix works the same anywhere in the US, and except for rights constraints, you could extend that to the entire world. But many taxes are local — and as streaming services swallow up more and more of the world's entertainment, that could be a serious problem.

Chicago's new tax is actually composed of two recent rulings made by the city's Department of Finance: one covering "electronically delivered amusements" and another covering "nonpossessory computer leases." Each one takes an existing tax law and extends it to levy an extra 9 percent tax on certain types of online services. The first ruling presumably covers streaming media services like Netflix and Spotify, while the second would cover remote database or computing platforms like Amazon Web Services or Lexis Nexis. Under the new law, what passes as $100 of server time in Springfield would cost $109 if you're conducting it from an office in Chicago.

[Vago]

Democratic party at its best...keep taking from the haves until everyone is a have not.

[zenkai]

I swear.... Politicians...

[Vago]

I swear.... Politicians...

Tell me about it, city is broke but recently they voted to give themselves a raise

[Theinquisition]

Democratic party at its best...keep taking from the haves until everyone is a have not.

I know right.

Christ, what will they think of next, a "taking a piss tax"?

[THE Bigzoman]

In other news, the PirateBay appears more attractive to internet/data users across the windy city.

[hiramloram]

How will folks get around it? VPN?

[Les Paul]

I know right.

Christ, what will they think of next, a "taking a piss tax"?

Someones got to pay for Obama's "Brother's Keepers" programs. Mor dem programs.

[Ripster42]

I'm guessing there will be a challenge under interstate commerce.

[Bakis]

As retarded as Sweden's taxation of mass storage components (4%).
Sweden's legislators has not understood that piracy is not a major issue today cos people use freaking streaming services.

[Kasierith]

I like how Netflix basically said, "well, ok I guess we can't argue... oh, and by the way everyone here's a super easy way for you to dodge this and get out of the tax."

Also, you can be fined 500 dollars for sitting on a sidewalk in Galveston, Texas. Pretending that Democrats are the only ones who play around with their constituents' finances on a whim is pretty two faced and frankly hilarious.

[Theinquisition]

I like how Netflix basically said, "well, ok I guess we can't argue... oh, and by the way everyone here's a super easy way for you to dodge this and get out of the tax."

Also, you can be fined 500 dollars for sitting on a sidewalk in Galveston, Texas. Pretending that Democrats are the only ones who play around with their constituents' finances on a whim is pretty two faced and frankly hilarious.

At least that fine can be avoided (not saying it's right, I assume the fine is there to fight loitering and vagrancy)

This is just a straight up tax not a "hey you Fucked up hetes your fine"

[Hooked]

Chicago is bankrupt, they just haven't been forced to file for it yet. Unions and political corruption have destroyed that city.

[twiddler]

The cloud is technically anything hosted offsite so I am lost by "cloud tax".

[Conspicuous Cultist]

I know right.

Christ, what will they think of next, a "taking a piss tax"?

Oxygen tax.

You have to pay per cubic meter of carbon dioxide you exhale alongside the oxygen tax.

The plastic garbage bag tax, you pay more for using plastic garbage bags instead of using cloth bags to deal with this. This applies to bathrooms as well.

An extra tax for 2+ ply toliet paper since you don't need that, just one ply.

Really don't tempt their wrath because they could still do worse.

[Theinquisition]

Citizens in the Peoples Republic of Chicago seem a bit overtaxed.

- - - Updated - - -

Oxygen tax.

You have to pay per cubic meter of carbon dioxide you exhale alongside the oxygen tax.

The plastic garbage bag tax, you pay more for using plastic garbage bags instead of using cloth bags to deal with this. This applies to bathrooms as well.

An extra tax for 2+ ply toliet paper since you don't need that, just one ply.

Really don't tempt their wrath because they could still do worse.

The "staring at girls in Yoga pants tax" is going to hit me hard this year.

[Herewe Goagain]

Need that cash to feed that Jones.

[Elegiac]

So basically they're trying to apply sales tax to a digital transaction. -le gasp-

[Conspicuous Cultist]

Citizens in the Peoples Republic of Chicago seem a bit overtaxed.

- - - Updated - - -



The "staring at girls in Yoga pants tax" is going to hit me hard this year.

Add a wingman tax to that as well, the world's too populated and we need to make it harder to game.

[Vago]

I like how Netflix basically said, "well, ok I guess we can't argue... oh, and by the way everyone here's a super easy way for you to dodge this and get out of the tax."

Also, you can be fined 500 dollars for sitting on a sidewalk in Galveston, Texas. Pretending that Democrats are the only ones who play around with their constituents' finances on a whim is pretty two faced and frankly hilarious.

Lets not mention that the law in Texas is 20 years old and never enforced. Just like in NC a woman can't wear less than 5 yards of clothing (that seriously is a law on the books) but it's never enforced. This is a NEW law in today's age knowing everyone using digital media.

So yea, I call me two faced if that's what you want to call it or you know you could just ignore the facts. Democratic party for ya! Just like the new tax on insurance premiums; wolf in sheeps clothing

Edit: and to add the law reads like this "It shall be unlawful for a person to stand or sit on a city sidewalk or city right-of-way so as to impede, physically or by intimidation, free and uninterrupted pedestrian passage"

So you most certainly can sit on the sidewalk so long as you aren't impeding or intimidating other.