On January 14, 2020, legislation (L.B. 989) was introduced in the Nebraska Legislature that would expand the sales tax base to include sales of “digital advertisements.” “Digital advertisement” means “an advertising message delivered over the Internet that markets or promotes a particular good, service, or political candidate or message.” Nebraska is now the second state (after Maryland) to consider taxing digital advertising services. While the Nebraska and Maryland proposals take different approaches to taxing those services, both proposals likely violate the Internet Tax Freedom Act as discriminatory against e-commerce. If L.B. 989 passes, the tax on digital advertisements would take effect on October 1, 2020.
