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Andrew Wilford, director of state policy for the National
Taxpayers Union Foundation said Illinois’ 10% targeted
advertising services tax has one of the same fatal flaws.
Wilford said federal law does not allow discrimination against
digital products.
“For example, you can’t tax digital advertising and not tax
traditional advertising. Unfortunately, that is what Illinois
does, so this very much suggests that Illinois’ tax could very
well be coming off the books,” Wilford told The Center Square.
Jared Walczak, senior fellow at the Tax Foundation, said the
Maryland ruling was five and a half years in the making.
“A Maryland court has no jurisdiction over Illinois, but an
Illinois court looking at this, or eventually a federal court
looking at this, would be looking at the exact same statutes,
the exact same case law, the same constitutional provisions, and
would likely come to the same conclusions,” Walczak told The
Center Square.
Illinois’ tax is scheduled to take effect on January 1, 2027
after it was included in the state revenue package signed by
Gov. J.B. Pritzker in June.
On Aug. 5, State Rep. Travis Weaver, R-Peoria, filed House Bill
5807 to repeal the tax.
Statehouse Republicans have also filed bills to repeal the 0.2%
digital assets tax and the governor’s social media platform fee.
Walczak said a state or federal court would hear the same
arguments the Maryland court did and likely reach the same
conclusions with Illinois’ digital ad tax and social media fee.
“If anything, some of them are even stronger with Illinois’
social media tax because of how poorly drafted it is, how broad
it is, whether intentionally or accidentally,” Walczak told The
Center Square.
Illinois’ digital assets tax is already facing a legal challenge
in Sangamon County court.
The Digital Chamber filed a complaint last month against
Illinois Department of Revenue Director David Harris and
Attorney General Kwame Raoul, claiming the tax violates both the
U.S. and state constitutions.
Bellementis law firm partner Olta Andoni said there are also due
process implications with Illinois’s digital asset tax.
“So the tax is void for vagueness and has very undefined terms,
includes a felony as well, and rests on an unconstitutional
presumption,” Andoni told The Center Square.
In June, Kalshi filed suit against the new Illinois tax on
prediction markets.
The Illinois revenue package also includes a new tax on sports
wagering.
Sean Reed contributed to this story
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