Ohio Advertising Tax Threat
By Kathy Jex
Recently, Ohio Governor John Kasich proposed a budget plan which includes extending the sales tax to a variety of services, including advertising. This proposed legislation would mean that all advertising services and ad placement in all forms of media would have a sales tax added to the cost.
The Advertising Club of Toledo strongly opposes this tax, and is joining efforts with our AAF affiliate clubs in Ohio as part of a larger industry coalition (broadcasters, newspapers, etc.) to voice a united response to our legislators before this budget can be passed. It is of great importance that you also add your voice to the opposition by contacting your state representative and telling him or her that you are opposed to any tax on advertising. You can find your representative and contact information at http://www.ohiohouse.gov/index. The Finance Committee is expected to conduct hearings later this month so your quick response will be helpful.
Arguments Against A State Ad Tax
Placing a tax on advertising services and/or placement increases the cost of advertising. Because most clients operate on a fixed advertising budget, they will compensate for the tax by decreasing their advertising purchases. This will have a direct — and negative — impact on the advertising industry, economy, consumers and the state.
Advertising is the primary source of revenue for the print media and the sole source for broadcasters. A reduction in advertising would inevitably result in a loss of jobs and a decreased ability to provide quality content and programming.
Advertising is the engine that fuels the economy. Less advertising means fewer sales. Fewer sales mean reduced revenue and fewer jobs. Fewer sales also result in less sales tax revenue for the state.
Consumers will suffer. Advertising is an important source of information. In fact, the U.S. Supreme Court in the landmark Virginia Pharmacy case noted that for many people, the information in advertising is more important than news about current issues.
Prices may rise. Studies show that advertising fosters competition and helps lower the price of products and services. Less advertising means less competition.
National advertising dollars will leave the state. Marketers will move to markets where they can reach the most consumers with the fewest dollars.
Border markets will suffer. Media in markets close to the state line will lose money to untaxed media across the border.
Press Release Contact Name: Patrick Giammarco
Press Release Contact Email: [email protected]
Press Release Contact Phone: 419.329.4256
Organization Name: Advertising Club of Toledo
Website or Link: www.adclubtoledo.org
Organization Address: 27100 Oakmead Dr., PMB 217, Toledo, OH, 43528