Magazine article Editor & Publisher

Wisconsin Newspapers Join Battle to Stop Ad Services Tax

Magazine article Editor & Publisher

Wisconsin Newspapers Join Battle to Stop Ad Services Tax

Article excerpt

NEWSPAPERS IN WISCONSIN have joined other media groups in a recently formed coalition, in order to launch a preemptive strike against a possible statewide advertising services tax.

The Wisconsin state Legislative Fiscal Bureau has bandied about the idea of an advertising services tax in order to close a projected $2.1 billion budget shortfall over the next two years.

Essentially, the state's current 5% sales tax would be extended to items that are not currently taxed, such as advertising services., The tax could raise as much as $75 billion, the bureau has estimated. One version of an ad tax could mandate that an ad agency must pay a 5% tax on all advertising placed in the state. Agencies might try to pass the tax along to newspapers, radio or other media. A media services tax also has been discussed that would tax all ads placed in newspapers, on radio and elsewhere.

Newspapers, broadcasters and ad agencies say an ad tax would adversely impact their businesses, leading to lost jobs and lower advertising revenues.

"It would be devastating," said John Labbs, president of the Wisconsin Broadcasters Association. "We're talking thousands of jobs and hundreds of millions of dollars. The advertising community and communications industry have to be concerned about it."

The No Ad Tax Coalition was formed by the Broadcasters Association, and other media in the state readily joined in. Besides including broadcast and newspapers, the coalition is backed by cable TV, printing organizations, outdoor advertising and free shoppers. …

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