California Senate Passes Online Ad Tax

S.B. 1327 would increase costs for businesses and consumers while enriching private equity

May 21, 2024

On Wednesday, the California State Senate passed SB 1327, which would institute a 7.25% tax on digital advertising. The new taxes would fund California media outlets, including those controlled by private equity firms, which have decimated journalism in the state.

Earlier this month, Chamber of Progress sent a letter to Senate leaders urging them not to move forward with SB 1327 over concerns that the legislation would increase costs for local businesses and send revenues to private equity groups and right-wing outlets.

“Creating a new digital ad tax is going to have downstream consequences for California businesses that sell their goods to the world through digital advertising, and raise prices for the consumers who buy products online,” said Chamber of Progress CEO Adam Kovacevich.  “At a time when California faces a growing budget deficit, the fact that Maryland’s similar ad tax has never collected a dime because of legal challenges, makes it likely that California would deepen its budget hole by having to pay news outlets revenue that the state hasn’t even collected.”


Chamber of Progress ( is a center-left tech industry policy coalition promoting technology’s progressive future.  We work to ensure that all Americans benefit from technological leaps, and that the tech industry operates responsibly and fairly.  

Our corporate partners do not have a vote on or veto over our positions. We do not speak for individual partner companies and remain true to our stated principles even when our partners disagree.