- Legal Challenge Filed: A taxpayer has filed a lawsuit in Washington superior court contesting the validity of new legislation (ESSB 5814) that expands the state’s sales and use tax to include certain advertising services, both digital and nondigital.
- Claims of Discrimination: The taxpayer argues that the exclusions for certain advertising formats create a tax burden that disproportionately affects internet-based advertising, potentially violating the federal Internet Tax Freedom Act (ITFA).
- Concerns Over Digital Automated Services: The lawsuit also claims that the imposition of Washington use tax on advertising services classified as digital automated services (DAS) discriminates against internet advertising by taxing it while similar offline services remain untaxed.
Source Deloitte
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