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News
Tennessee Considers "iPod Tax"
Thursday, April 24th, 2008 at 4:00 PM - by Jeff Gamet
Tennessee is considering supplementing its revenue shortfall with a tax on digital downloads. The state’s Digital Products/iPOD Tax, which is part of the "Technical Corrections" bill, is still in preliminary stages and plans to include nearly any type of digital media download.
According to an analysis by attorneys at the Nashville-based Waller Lansden Dortch & Davis law firm, the bill "would subject downloaded sales of digital media, including music videos, motion pictures, news and entertainment programs, music, ringtones, electronic books, etc. to the retail sales tax."
At least for now, it appears that software downloads are safe from the proposed tax.
The proposed legislation hasn’t been presented to Tennessee lawmakers yet, but that’s not stopping some from critisizing the move.
"Most states do not tax digitally-deliverd products," said state communications director Bill Hobbs. "Tennessee shouldn’t either and state government’s current fiscal crisis should not be used by the Bredesen administration as an excuse to hit the people of Tennessee with a new tax that could cost them tens or even hundreds of millions of dollars."
Apparently the state is facing a US$500 million budget deficit and is looking every place it can for additional revenue, according to WDEF News 12. Should the digital download tax find its way into law, it likely won’t site well with the state’s consumers or the companies that provide the content facing taxation.
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