> They’re calling it a utility, so it can be taxed like water and electricity.

Curious how it's not a utility when we start talking about regulating who provides Internet service and under what terms, but then it is one when they want to tax your use of it.

A municipal tax on cable TV can be enforced because there's a physical line to a residence in the municipality.

What's stopping users from ordering netflix to an "address" in a tax-free municipality? For that matter, how are they determining this in the first place? I never told netflix where I live; they only have a billing address. But billing addresses aren't where tax is due; I regularly pay municipally taxed services for one address at another billing address.

So... What exactly is the cost to government being justified here? Usually a tax is to pay for something, in this case it seems to be just "hey we want some of that money, give us some". What the fuck.

Dear whoever thought this was a good idea,

Do you know what else has no tax? Piracy.

If this is the best answer the cable company lobby could come up with, Netflix has already won.

I see a lot of comments here in shock and disbelief. In the spirit of at least trying to consider the most charitable view if the events I would like to offer my justification for what happens.

Municipalities tax consumption on their territory. By contrast, the federal government taxes income and/or profit. The individual states tax one or the other or both. This division has to do, in part, with practicality of administering the tax.

The primary purpose of taxes is to fund the projects for the common good, plus the overhead. The secondary purpose is to promote or suppress certain activities, such as tobacco use. Tying a certain tax to a certain purpose is an exception rather than the rule. Most taxes go into the common pool.

Had there been a movie theater in town it would have been taxed. The same is true if both the server and the viewer were in the same town - the server would be taxed as a business and the viewer would be taxed as a consumer.

Moving the server to a different location leads to a situation where the consumption tax is not paid in either jurisdiction. Thus an arbitrary act of placement has dramatic consequences for the revenue of municipalities. It also puts local business at disadvantage, undermining the business tax base and jeopardizing jobs, so further eroding the funding of the common good.

Yeah, I prefer to pay less myself. I also run a Saas business and I would rather not have to collect the taxes. Still if I am concerned with the fairness of it, I have to admit that uniformity trumps my personal preference.

How do people so clueless end up in a public office that can even make a decision like this?

I live in UK and I haven't been watching broadcast TV since 2013 - streaming all that I need. So, I will find it annoying if I am hit with an additional TAX just because I utilize the service that I already pay for to the best of my abilities - mind you that I also pay additional subscription fees for online streaming content and faster fiber. I totally support the TAX on plastic bags to prevent littering the environment but TAX on online content? What is the point of that?

This is absolutely ridiculous. Who is coming up with these terrible policies?

Netflix already have to did it in Brazil due cable TV lobby pressure.

Ugh. I had to check the url twice to make sure this wasn't a story from the Onion.

What if Netflix dropped their price to compensate in California. The combination of the tax along with Netflix's good gesture would give them huge positive publicity.

So what the city gets an extra $1 or something. That seems pretty silly to tax

9.4% tax on $8 a month is around 75 cents.

People will complain about anything.