WASHINGTON (FOX 5 DC) - In the wake of a wild D.C. council meeting that had its chairman delay and then offer to cancel a 3 percent tax on advertising, pressure is building to scrap it altogether.
The proposed tax would fall on television stations like FOX 5, as well as newspapers, radio stations, digital platforms and businesses who advertise with them.
But industry analysts say the cost will eventually fall on the consumers in the form of higher prices.
D.C.’s proposed ad tax is being called everything from a business killer to a pyramid scheme.
The council gave the tax preliminary approval two weeks ago, but since then, councilmembers like Brooke Pinto say they’ve been flooded with calls.
And Brianne Nadeau says the council may now need to look elsewhere for revenue.
“That’s the thing we focused on in other revenue generators that did pass the council in prior meetings. So when it comes to the ad tax I think there just needs to be more dialogue,” Nadeau said.
“There is a lot of consistent feedback from many members of our community in many different industries that are in agreement that. This ad tax would be harmful for our small businesses and harmful for our news organizations,” Pinto said.
After a near council revolt, Chairman Phil Mendelson appears to be reconsidering the D.C. ad tax.
He’s delayed the vote for now, but he did tell councilmembers that he’s open to canceling it altogether if they cut $18 million in spending that he’d hoped to raise from the tax.
Industry analysts say advertising it rarely taxed because it drives commerce.
D.C. Mayor Muriel Bowser is also fighting the ad tax.
The mayor has some blunt advice: She says if the council would just stop spending, they wouldn’t have to keep taxing.
“What they need to do is cut their spending increase proposal by $18 million dollars, so they’d be rolling back something that hasn’t started. You follow me?” the mayor said.
FOX 5 reached out to Mendelson – who is the sponsor of the ad tax. According to his office, he wasn’t available because he’s writing an amendment to his plan, which he hopes to introduce at Thursday’s council meeting.
On late Wednesday night, Mendelson released the following statement, saying, in part:
"The amendments I am circulating today will reverse a policy choice that I now regret - a new tax. I overestimated the effect my proposing this tax would have to discourage colleagues’ desire to raise other taxes. At issue, fundamentally, is whether our Council will succumb to dubious demands to tax-and-spend."