Excise tax on certain social media platform businesses establishment
SF3065 would create a new excise tax on certain social media platform businesses based on the number of Minnesota consumers from whom the business collects data in a month. The tax is structured on a per-consumer basis, with no tax for businesses at or below 100,000 Minnesota consumers, then increasing monthly per-consumer amounts for larger businesses: $0.10, $0.25, or $0.50 depending on the size of the Minnesota user base. The bill defines key terms such as consumer data, Minnesota consumer, and social media platform business, and it presumes a consumer is a Minnesota resident if the business has a Minnesota address, mailing address, or Minnesota-linked IP address on file unless the business proves otherwise.
The bill would add a new section to Minnesota Statutes, chapter 295, creating a social media gross receipts tax and giving the Department of Revenue authority to administer, audit, assess, collect, and enforce it under existing tax procedures. It would require affected businesses to file returns, maintain records, and remit tax payments, with revenues deposited into the general fund. The bill also includes a credit for tax paid to another jurisdiction if that state imposes an identical excise tax on the same consumer, and it applies controlled-group aggregation rules so related corporations are treated as a single entity for threshold purposes. The tax would apply only to consumer data collected after December 31, 2025.
The available record shows no committee transcript, vote tally, or recorded amendments, so there is no direct evidence of debate or formal support/opposition in the materials provided. Based on the bill text alone, the measure appears designed as a revenue-raising tax on large social media companies, which typically draws interest from supporters of tax expansion and scrutiny from affected industry stakeholders. Because no hearing discussion is included, the overall sentiment cannot be measured beyond the bill’s introduction and referral to the Taxes Committee.
The main points of contention likely center on whether taxing social media platforms based on consumer data collection is an appropriate and workable tax base, and whether the thresholds and presumptions are fair to businesses operating in Minnesota. Businesses may object to the presumption that certain address or IP information makes a consumer a Minnesota resident, as well as the burden placed on the company to prove otherwise. Another likely issue is the treatment of controlled groups and the broad definition of consumer data, which could expand the number of firms subject to the tax. Supporters would likely emphasize that the tax targets large, profitable platforms and generates general fund revenue, while opponents may argue it could be difficult to administer, raise privacy concerns, or be passed on to users or advertisers.