- Illinois enacted a 10% tax on gross receipts from targeted advertising services delivered to users in Illinois, effective January 1, 2027, under Senate Bill 3019.
- The tax applies to providers with more than $1 million in annual gross receipts and is broadly defined to cover digital and other advertising formats, including search ads, banner ads, interstitial video ads, social media ads, and native content.
- The law includes exemptions for certain small businesses and news media organizations, but many digital advertising businesses may have collection and compliance obligations starting in 2027.
- NetChoice has filed suit challenging the tax, arguing it violates the First Amendment, discriminates against interstate commerce under the Commerce Clause, and is preempted by the federal Internet Tax Freedom Act.
Source: salestaxinstitute.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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