In gross receipts tax, further providing for imposition of tax.
Summary
SB1199 would expand Pennsylvania’s gross receipts tax to explicitly include companies providing digital advertising services in the Commonwealth. The bill defines digital advertising services as advertisements displayed on a digital interface, including banner, search engine, interstitial, and comparable ads that use user personal information. It also defines key terms such as “digital interface,” “user,” “broadcast entity,” and “news media entity.”
The bill preserves the existing gross receipts tax framework for pipeline, transportation, telephone, telegraph, and mobile telecommunications businesses, while adding a new taxable category for digital advertising services. It also creates an exemption for advertising services displayed on digital interfaces owned or operated by broadcast entities and news media entities. The tax change would apply to taxable years beginning after December 31, 2025, and the act would take effect immediately.
Impact
SB1199 would amend the Tax Reform Code of 1971 by broadening the gross receipts tax base to reach digital advertising revenue earned in Pennsylvania. This would affect digital advertising providers and potentially other online platforms that sell ad inventory, while excluding advertising on broadcast and news media entities’ own digital interfaces. The bill would also leave existing exclusions for certain telecommunications-related receipts in place, and it would apply prospectively to tax years beginning after the end of 2025.
Sentiment
Because there are no committee transcripts or recorded votes provided, there is no documented legislative debate or vote history to indicate support or opposition. Based on the text alone, the bill appears to be a revenue-raising measure aimed at modernizing the gross receipts tax to capture digital advertising activity, with a targeted exemption intended to protect traditional broadcast and news media outlets.
Contention
The main policy issue is the extension of a gross receipts tax to digital advertising services, which could be viewed as a new tax burden on online advertising businesses and digital platforms. A likely point of contention is the scope of the tax and whether it should apply to advertising that uses personal information and is displayed on digital interfaces. Another notable issue is the exemption for broadcast and news media entities, which may raise questions about competitive neutrality and whether similar treatment should extend to other media or content providers.
In sales and use tax, further providing for exclusions from tax; and, in gross receipts tax, further providing for imposition of tax; and providing for reporting and for transfers.
In gross receipts tax, further providing for imposition of tax and for establishment of revenue-neutral reconciliation; and providing for reporting and for transfers.