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Is Philadelphia’s Tax on Bloggers That Big of a Deal?

Every state, municipality, township and hamlet is desperate to close their budget gaps. With such desperation comes a flood of bad ideas that include taxes on everything from juggling to hot air balloon rides.

The Philadelphia City Paper ran a story last week about the $300 Business Privilege Tax that the city is imposing on bloggers, freelancers and other contractors since they are engaged in the activity for profit. Seemingly, another stupid idea.

The City Paper speaks to a couple of bloggers – clearly doing it as a hobby – that are technically engaged in a for-profit activity because they have ads on their blogs. They were notified by the city that they owed the $300 for a lifetime business privilege license (you can also opt for a $50 annual license). The Philadelphia Department of Revenue argues that “simply choosing the option to make money from ads — regardless of how much or little money is actually generated — qualifies a blog as a business.”

Supposedly, changes to the city’s law are in the works to be introduced next month that would exempt the first $100k of a business’s profit.

However, there is a far simpler solution to this problem that is mentioned by Christina Warren over at Mashable which is, quit running ads on your blog. Maybe the city’s tax is excessive, annoying, desperate for reform or just plain stupid but if you don’t run ads on your blog – that wasn’t designed to make money – you avoid the business privilege license altogether. It’s as simple as clicking a mouse and the government is out of your life (at least this respect).

Or continue to be stubborn and fight the bureaucracy of the Philly City government. Your choice.

Pay Up [Philadelphia City Paper]
Philadelphia Tax Code Sparks Big Controversy with Small Bloggers [Mashable]