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H 3263

An Act establishing a tax on local revenues from digital advertising

194th Legislature (2025-2026) Introduced by Erika Uyterhoeven

Massachusetts bill imposes new tax on local digital advertising revenues to generate state revenue, potentially affecting tech companies and small digital marketing businesses.

Accompanied a study order, see H5196
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Bill Summary · H 3263

Legislative bill overview

H 3263 proposes a tax on local revenues generated from digital advertising in Massachusetts. The bill would create a new revenue stream for the state by taxing businesses on income they earn specifically from digital advertising services provided to local customers or clients.

Why is this important

Digital advertising represents a growing, largely untaxed sector of the economy, and Massachusetts would be among early adopters of such a tax if passed. The revenue could fund state services, but the tax structure may affect how tech companies, small digital marketers, and online platforms operating in Massachusetts price their services and do business.

Potential points of contention

  • Definition and scope: Determining what qualifies as "digital advertising" and "local revenue" could be complex and create compliance challenges or unintended consequences for different business types
  • Economic competitiveness: Companies may relocate operations or shift business models to avoid the tax, potentially reducing Massachusetts' attractiveness for digital economy businesses
  • Regressivity concerns: The tax could increase costs for small businesses and nonprofits relying on affordable digital advertising, with potential pass-through to consumers

Compiled from official sources — confirm details with the bill’s official record.

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