DC’s proposed ad tax tabled, could be nixed

Debate over DC advertising tax

A D.C. council chairman who has proposed a 3 percent sales tax on all advertising appears to have a revolt on his hands.

WASHINGTON (FOX 5 DC) - A D.C. council chairman who has proposed a 3 percent sales tax on all advertising appears to have a revolt on his hands.

A week after giving preliminary approval for the tax, council members say they’ve been flooded with thousands of calls demanding they vote “no.”

The D.C. Council was supposed to vote on creating the ad tax on Tuesday, but those plans blew up underneath Council Chair Phil Mendelson. Local television stations including FOX 5, newspapers, radio stations, digital platforms, and advertisers say the ad tax if a business killer – and that costs would be passed onto the consumers.

In an emotional debate, council members now appear to agree.

“I’m really worried about the effect of this ad tax on our local businesses and our news organizations,” DC Council Member Brooke Pinto said on Tuesday.

Councilmember Charles Allen also chimed in, saying “I do believe we have issues we have to resolve with this ad tax! I think it’s going to have an impact on our local businesses. I’m hearing it from them.”

Mendelson expected his ad tax to pass the goal line – but instead, he had to punt it away, delaying and then offering the possibility of canceling the tax altogether.

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District of Columbia Council Chair Phil Mendelson (Photo by Caroline Brehman/CQ-Roll Call, Inc via Getty Images)

A frustrated chairman now says he’ll withdraw the tax if the council comes up with $18 million in cuts from other areas.

The debate on the ad tax dragged on so long, the council never had a chance to get to its plan to cut $15 million from Mayor Muriel Bowser’s police budget.

The mayor is warning against those cuts, saying D.C.’s chief financial officer might not certify the budget because it could lead to astronomical overtime costs.

"It's his job to call out insufficiencies in budget making and we have some concerns about cutting the budget, which would trigger overtime costs that I'm not sure have been properly accounted for," the mayor said.

Bowser has repeatedly called out the council’s spending decisions.
She says she’s not given anyone in her office a raise given the economic conditions, but it turns out the council’s moving to expand its own staff to as many as 62 new positions to the tune of nearly $1 million.