ANA Lobbies To Preserve Tax Break For Ad Expenses

The Association of National Advertisers is urging Congress to preserve a longstanding tax code provision that allows companies to deduct all of their ad expenses.

Any attempt to change the deductibility of ad expenses "would result in less information being available to consumers through internet publishers, newspapers, magazines, radio and television stations and networks, and cable networks and operators," the ANA and other members of the lobbying group The Advertising Coalition argue in a letter sent last week to the House Ways and Means Committee.

"Advertising is essential to the operation and even the survival of our national independent providers of news and information," the letter states.

The organization adds that if companies cut back on advertising, media outlets will suffer a loss of revenue that will "reduce their ability to make information available and would weaken a core underpinning of our democracy -- an informed electorate."

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The new ANA initiative comes as Congress is gearing up to tackle tax reform. The organization hopes to head off proposals to change the deductibility of ad costs, according to ANA executive vice president Dan Jaffe.

"There's no proposal immediately on the table. But we are in an extraordinary, almost unprecedentedly, volatile period in regard to tax reform," he says. 

Lawmakers have previously considered changing the deductibility of ad expenses, but decided against doing so. In 2009, for instance, Congress didn't move forward with a proposal to eliminate the tax deductibility of prescription drug advertising costs.

Also, in 2015 the House considered a proposal put forward by former Ways and Means Committee Chair Dave Camp that would have required companies to amortize some of their ad expenses. That proposal, which was never enacted, would have resulted in at least $169 billion in additional taxes on advertisers, according to the ANA.

It's not yet known when the White House plans to issue a formal proposal to revise the tax code.

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