By Kathy Kennedy
State Rep., R-119
Kathy Kennedy
Connecticut users of the music streaming service Spotify received emails last week that state sales taxes will be going up starting next month.
Effective Oct. 1, 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 percent rate.
The new tax rate also applies to a purchased product like Adobe on which you pay a monthly subscription fee.
Currently the tax on digital goods is 1 percent.
An increased percentage of digital consumers are 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.
If you are a user/subscriber of Netflix, Hulu, iTunes 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.
It’s just another in a long line of tax and fee increases imposed by the state budget adopted this session by the majority party, most of which impact working families here in Milford and Orange and throughout Connecticut. It is a shame that the leaders in Hartford have chosen not to control spending and costs but to rely on yet another tax increase.
Read the Department of Revenue Services’ Sales and Use Taxes on Digital Goods and Canned or Prewritten Software policy statement at 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.
Great. Sick of online companies getting away with not collecting sales tax while local companies have to. Never mind CT. Even Republican governors are loving this. Maybe you would rather a higher income tax instead?