State Rep. Kathy Kennedy: Milford & Orange Residents Brace for New Tax Hike

Posted on September 24, 2019 by jdooley


Dear Neighbors,

Connecticut users of the music streaming service Spotify received emails last week that the state sales taxes will be going up starting next month.

Effective October 1, 2019, sales of “digital goods” that are electronically accessed or transferred, which includes audio works, visual works, audio-visual works, reading materials or ring tones, will be subject to sales and use taxes at the standard 6.35% rate.

The new tax rate also applies to a purchased product, like Adobe, that you pay a monthly subscription fee on.

Currently the tax on digital goods is 1%.

With an increased percentage of digital consumers streaming and downloading their content (music, movies or smartphone apps), as opposed to watching on traditional cable television or listening on the radio, the majority party and the governor hiked these taxes on countless residents. This is an effort to capture a new revenue stream as people flee cable for lower cost options.

So if you are a user/subscriber of Netflix, Hulu, iTunes, and/or Amazon Prime, your taxes will increase. Even if you want to download a new book on your Kindle or movie on your iPad, you also will have to pay the increased tax.

The increase in taxes on digital downloads is expected to raise $27.5 million this fiscal year and $37.1 million in the next year.

Many people choose to stay home and watch a movie instead of going to the cinema, download a book versus buying a hardcover, or stop their cable use due to cost. We should not penalize them by looking for a way to take their newly found savings. 

Read the DRS Sales and Use Taxes on Digital Goods and Canned or Prewritten Software policy statement here: https://www.cthousegop.com/wp-content/uploads/2019/09/DigitalTaxUpdate.pdf

As always, please contact me should you have any questions or concerns relating to state government at Kathy.Kennedy@housegop.ct.gov or at (800) 842-1423.

FOLLOW STATE REP. KATHY KENNEDY

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Questions? Contact 860-240-8700