Popular streaming services will cost Chicagoans more
July 2, 2015 04:26 PM
There’s little that’s amusing about Chicago’s so-called amusement tax, and now Chicago residents who stream entertainment from companies like Netflix Inc. and Spotify Inc. will have to pay the 9% tax.
The city says the ruling from the city’s finance department is not an expansion of current law but a clarification on it, however the clarification does mean Chicago residents subscribing to Netflix’s $7.99 monthly service will see a 72-cent increase in their monthly bills. Netflix says it will start collecting the tax, which it will have to remit to the city annually.
"In an environment in which technologies and emerging industries evolve quickly, the City periodically issues rulings that clarify the application of existing laws to these technologies and industries," a city spokeswoman says.
Chicago Municipal Code states that the tax applies to all entertainment or recreational activities offered for public participation or on a membership or other basis are amusements subject to the tax, with exceptions only made for certain religious, charitable and not-for-profit organizations for fundraising purposes.
Netflix, No. 6 in the Internet Retailer Top 500 Guide, did not respond to a request for comment.