RELATING TO TAXATION OF ADVERTISING REVENUE BY MAJOR SOCIAL MEDIA PLATFORMS.

2025 Regular Session Introduced by Ikaika Hussey

House Bill 1458 taxes advertising revenue from major social media platforms to fund broadband access and digital equity initiatives, boosting Hawaii's economy and local communities.

Referred to ECD, CPC, FIN, referral sheet 4

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# Summary of House Bill 1458 **Bill Number:** HB 1458 **Title:** Relating to Taxation of Advertising Revenue by Major Social Media Platforms **Status:** Referred to ECD, CPC, FIN, referral sheet 4 **Introduced:** February 12, 2025 **Classification:** Bill **Subject:** Advertising on Major Social Media Platforms, Appropriation ($), Broadband and Digital Equity Special Fund, Corporate Income Tax, DBEDT, Hawaii Broadband and Digital Equity Office ## Purpose and Intent House Bill 1458 aims to establish a framework for the taxation of advertising revenue generated by major social media platforms operating within the state. The bill seeks to ensure that these platforms contribute to the state's economy and support local initiatives, particularly in broadband and digital equity. ## Key Provisions - **Taxation of Advertising Revenue:** The bill proposes a tax on the advertising revenue earned by major social media platforms. The specifics of the tax rate and structure will be defined in subsequent regulations. - **Broadband and Digital Equity Fund:** Revenue generated from this tax will be allocated to the Broadband and Digital Equity Special Fund. This fund is intended to enhance broadband access and promote digital equity initiatives across the state. - **Corporate Income Tax Adjustments:** The bill may include adjustments to the corporate income tax framework to accommodate the new taxation on advertising revenue, ensuring compliance and clarity for affected entities. - **Regulatory Oversight:** The Department of Business, Economic Development, and Tourism (DBEDT) and the Hawaii Broadband and Digital Equity Office will oversee the implementation and regulation of this tax. ## Affected Parties - **Major Social Media Platforms:** Companies such as Facebook, Twitter, and Google that generate significant advertising revenue in Hawaii will be directly impacted by this legislation. - **Local Businesses and Communities:** The bill aims to benefit local businesses and communities by funding initiatives that improve broadband access and digital equity, potentially leading to increased economic opportunities. - **State Government:** The state will gain additional revenue through the taxation of advertising revenue, which can be reinvested into public services and infrastructure. ## Procedural Aspects - **Referral Process:** The bill has been referred to multiple committees, including the Economic Development Committee (ECD), Consumer Protection Committee (CPC), and Finance Committee (FIN), for further review and recommendations. - **Timeline:** The bill was introduced on February 12, 2025, and is currently in the legislative process, with further actions expected as it moves through the committee stages. ## Conclusion House Bill 1458 represents a significant step towards regulating the advertising revenue of major social media platforms in Hawaii. By establishing a tax framework and directing funds towards broadband and digital equity initiatives, the bill aims to enhance the state's economic landscape and ensure that all residents have access to essential digital resources.