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DC weighs advertisement tax to raise city revenue during pandemic

The council is looking at new revenue streams. A 3% tax on all ads is on the table.

WASHINGTON — D.C. is looking for ways to shore up its finances in the wake of the coronavirus pandemic. Commercials advertisements might get taxed.

In July, the D.C. Council proposed a 3% tax for all media ads like billboards and commercials.

It would affect all media outlets from websites to newspapers to television stations like WUSA9. All outlets would be taxed 3% on ad sales.

Business leaders believe that tax would likely get passed onto businesses that want to advertise.

“Every time you're going to make an ad, let's say you’re a small restaurant. It is going to cost you 3% more," said Angela Franco, from the D.C. Chamber of Commerce. "But its like 3% here, 3% there. Add that to all the tension [businesses] are already going through with the coronavirus.”

The council is in the middle of the Fiscal Year 2021 Budget negotiations. The loss in revenue from the pandemic has created shortfalls in some areas. 

D.C.'s Council has discussed income and sales tax increases. In addition to the proposed ad-sales tax, the council is also looking to raise the gasoline tax in the city. If that gas tax is raised it would equal the gas tax level for nearby Virginia.

The council also has proposed cuts to the Metropolitan police budget, as well as redirecting some police funding to other community efforts. 

D.C. Mayor Muriel Bowser has opposed the advertising tax.

If Tuesday's vote goes through, the D.C. Council believes the ad tax could raise up to $18 million to offset the city’s losses from the pandemic.

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