Some New York state lawmakers are proposing to tax companies that glean income from consumers' data.
On Tuesday, Assembly member Stacey Pheffer Amato (D-Rockaway Beach) introduced Assembly Bill A09112, which would impose a 5% tax on gross revenues of all corporations that derive income from data shared with them by state residents, and would establish a “data fund” to distribute the tax to residents.
“New York's consumers should also be able to share in the wealth that is created from their data,” Pheffer Amato's memo in support of the bill states. “Turn on your phone, check your email, watch TV, browse the web, drive through a toll or, talk to a friend on the phone. In all of these activities, data about our actions, behaviors, likes and dislikes, mood and feelings, purchases and choices are being recorded by a huge variety of organizations that never will inform you of the data they collect, sell and share.”
The bill is a companion to one introduced last year in the state Senate by David Carlucci (D-Rockland/Westchester).
Carlucci's bill was seen as a long shot. State Senator Phil Boyle (R-Bay Shore) told News 12 Long Island in December that the proposed tax could keep tech companies out of the state.
New York politicians aren't the only ones to float the idea of a data tax. Last year, California Governor Gavin Newsom suggested that Silicon Valley companies should pay residents a “data dividend” to compensate them for their information.
"California's consumers should also be able to share in the wealth that is created from their data," Newsom said last February. He didn't elaborate on his proposal other than to say that California could “do something bold in this space.”
A flat 5% tax on gross revenues is absurd. That's more than many profit margins and would throw prfitable companies into the red.
Is this, perhaps, a tax only on revenuie from the sale of data?
As currently written, the proposed bill would impose a tax of 5% "on gross income upon every corporation which derives income from the data individuals of this state share with such corporations."