New York: Proposed Bill Would Tax Corporations that Derive Income from Customer Data

Legislation was recently introduced in New York (Assembly Bill 9112) that would impose a five percent tax on the gross income of “every corporation which derives income from the data individuals of this state share with such corporations.”  The bill provides few details on the tax (e.g., it does not make clear whether or how the tax base is apportioned, or what it means to derive income from data individuals shared with the corporation). Taxes raised by the measure would be deposited into a newly created “New York Data Fund,” with a portion of the funds to be disbursed back to New York taxpayers. Much of the bill focuses on the make-up of the New York Data Fund Board, which would be established to manage and invest the assets of the fund. A similar measure has been pending in committee in the New York State Senate (Senate Bill 6102) since May 2019.  If passed, the bill would be the first of its kind to specifically tax companies that generate revenue from consumer-shared data, although Maryland and Nebraska have both recently introduced legislation that would tax receipts from digital advertising.  Please stay tuned to TWIST for updates on these proposals.