The Massachusetts Legislature has recently introduced a variety of bills that would tax digital advertising. Notably, HD.3210 would establish the Digital Advertising Local Revenues Tax, which would be imposed on the annual gross revenues of a person derived from digital advertising services in Massachusetts. “Digital advertising services” is defined as including “advertisement services on a digital interface, including advertisements in the form of banner advertising, search engine advertising, interstitial advertising, promoted, boosted, or sponsored content, and other comparable advertising services.” The tax rate would vary from 5 – 15%, depending on the level of the taxpayer’s annual gross revenues. The 15% rate applies to those taxpayers with annual gross revenues exceeding $200,000,001. The tax does not apply to those persons with less than $50,000,000 of annual gross revenues. If passed, the bill would take effect for the tax year beginning on January 1, 2022.
The Massachusetts Legislature has also introduced HD.3601, which would impose a 5% tax on a person’s annual revenue from digital advertising services within Massachusetts.