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AB 796

Social media platforms: advertising: tax.

2025-2026 Regular Session Introduced by Josh Lowenthal

Imposes a temporary tax on social media ad revenue (2026–2030) to fund a dedicated California Social Media Safety Trust Fund for education, mental health, research, and services.

In committee: Set, first hearing. Hearing canceled at the request of author.
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Bill Summary · AB 796

Summary — AB 796 (Lowenthal): Social media platforms — advertising tax

Status: Introduced Feb 18, 2025. In committee (Assembly Privacy & Consumer Protection; re‑referred to Revenue & Tax). First hearing was set for 04/19/25 but canceled at the author’s request. Committee vote (Apr 22): do pass and re‑refer to Rev. & Tax (Ayes 8, Noes 4).

Purpose / Intent

AB 796 would impose a temporary tax on social media advertising revenue to raise funds for programs that mitigate harms to adolescents and the public that the bill attributes to social media platforms (e.g., mental‑health impacts, cyberbullying, trafficking, law enforcement and education costs). The bill creates a dedicated state trust fund to support education, mental health, research and social services related to social media safety.

Key provisions

  • Imposes, for taxable years beginning on or after January 1, 2026 and before January 1, 2031, a tax on a “social media platform provider” equal to a percentage of the provider’s annual gross receipts from the sale/purchase of advertisements distributed on the platform. (The bill text provided uses an unspecified percentage.)
  • Creates the Social Media Safety Trust Fund in the State Treasury. All moneys raised under the tax would be deposited in the fund and continuously appropriated to administer the program.
  • Establishes separate accounts within the fund (examples named in the text: Education Account, Mental Health Care Account, Research & Development Account, Social Services Account) and directs allocation of revenues among them according to a formula. (Allocation percentages in the circulated text are left blank/unspecified.)
  • The funding may be used for grants (e.g., Superintendent of Public Instruction may award grants to school districts), services, research, and other programs to prevent or remediate harms from adolescent social media use.
  • The division in the Business and Professions Code creating the “California Social Media Accountability Act” would be repealed January 1, 2031.

Definitions

  • “Social media platform” is defined by functional criteria: a public or semipublic internet service with California users whose substantial function is connecting users for social interaction and that allows users to (1) build a public/semipublic profile, (2) list social connections, and (3) create/post content viewable by others. Email or direct messaging alone does not qualify.

Who is affected

  • Social media platform providers meeting the statutory definition that have users in California — including out‑of‑state platforms with sufficient nexus — would be subject to the ad‑revenue tax.
  • Revenue recipients: state programs, schools, mental‑health and social service providers, and researchers (as governed by the fund’s allocation and grant processes).
  • Advertisers could be indirectly affected if platforms adjust pricing to account for the tax.

Procedural / fiscal notes

  • The bill is classified as an appropriation bill; the digest indicates fiscal committee involvement.
  • Key fiscal details needed to estimate revenue and program funding (the tax rate/percentage, allocation percentages, and specific appropriation amounts) are blank or not specified in the available version of the bill.
  • The tax and fund are time‑limited (effective for taxable years starting 1/1/2026 through 12/31/2030; statutory provisions repealed 1/1/2031).

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

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