Virginia House Panel Strikes Down ‘Netflix tax’


Virginia lawmakers voted down a proposed tax on Monday. Proposed by Del. Vivian E. Watts, D-Fairfax, the new tax would have been imposed on Netflix, Spotify and other online streaming services.

The legislation would have applied a 5 percent communications tax. This would have added around 55 cents to the standard $10.99 Netflix plan. The Virginia House of Delegates committee voted 20-0 to kill the bill.

Virginia is not the first state to propose a tax on media streaming services. The first one I can recall was the city of Chicago. Lawmakers there sought to levy a 9 percent tax to “cloud services” including Netflix. This was met with opposition and the city has since suspended its efforts. Pennsylvania introduced a 6 percent tax on digital services in 2016.

Watts defended her bill saying it would generate an additional $7.9 million in revenue for the state. She said her bill was intended to help modernize the state’s communications sales and use tax. Those taxes already apply to landlines, cell phones, cable television and satellite radio.

Republicans disagreed:

“You know, ‘Netflix and chill,’” Del. Tim Hugo, R-Fairfax, said on the House floor. “Well, my Democratic friends say, ‘Netflix and tax.’”