KPA endorses letter opposing advertising tax

Posted January 24, 2014

ARLINGTON, Va. – The Kansas Press Association has joined 47 other press associations representing daily and weekly newspapers across the country in voicing opposition to an advertising tax proposal, saying it "would severely undercut the economic power of advertising to generate sales and support jobs."

Senate Finance Committee Chairman Max Baucus mentioned such a tax in a paper he released in December titled “Discussion Draft on Cost Recovery and Accounting Language."

The ad tax proposal would require all advertisers to wait up to five years before they can fully deduct the cost of half of their advertising as a business expense.

The letter, written by the Newspaper Association of America on behalf of the press associations, says: "The proposed tax on advertising would push our economy down at a time when businesses – including newspapers and other media that rely on advertising – are beginning to move forward in a positive direction.”

Advertising currently accounts for $5.8 trillion of the $33.8 trillion in U.S. economic output and supports 21.1 million of the 136.2 million U.S. jobs, according to estimates by economic consulting firm IHS Global Insight.

“The proposed tax would have an immediate and devastating impact on newspapers and other media, where advertisers underwrite much of the cost of bringing news, information and entertainment to all Americans,” the letter continues.

The associations’ letter reminds policy makers that advertising is an ordinary and necessary cost of doing business and has been treated as a deductible expense for 100 years and urges members of the Finance Committee to reconsider including the proposed tax in a tax reform package.

ABOUT NAA:
NAA is a nonprofit organization representing nearly 2,000 newspapers and their multiplatform businesses in the United States and Canada. Members include daily newspapers as well as nondailies, other print publications and online products. Headquartered in Arlington, Va., the association focuses on the major issues that affect today's newspaper industry, such as public policy/legal matters, advertising revenue growth and audience engagement across the medium's broad portfolio of products and digital platforms. More information about NAA and the industry is availableat www.naa.org.