First-ever digital advertising tax in PA passes state House
Sponsors Fiedler, Abney, Inglis highlight millions in potential revenue
Pennsylvania House Democratic Caucus June 9, 2026 | 4:30 PM
HARRISBURG, June 9 – Today, the PA House of Representatives passed the "Digital Ads Tax Bill" (H.B. 1678) with a bipartisan vote of 139-63. Introduced by state Reps. Elizabeth Fiedler, D-Phila.; Aerion Abney, D-Allegheny; and John Inglis, D-Allegheny, the legislation would update Pennsylvania’s existing gross receipts tax to include the sale of digital advertisements.
The vast majority of the tax would be paid by the wealthiest Big Tech corporations, including Google, Meta, Amazon, TikTok, and Microsoft, which represent an almost $300 billion industry in the U.S. The legislation would require multinational corporations to pay their fair share without raising taxes on consumers or small businesses. The tax applies to the platform selling ad space on websites and apps, not the retailer paying to promote their product.
“Plain and simple, this legislation is about requiring big out-of-state corporations profiting off the people of Pennsylvania to pay their fair share in taxes, and to invest in the public services and programs we all count on,” said Fiedler, who is the prime sponsor of the bill. “Working people are struggling to pay their bills and are tired of hearing there is no money for their schools, healthcare and transportation. If multinational corporations making record-breaking profits want to do business in our state, then they should pay their fair share just like working people and small businesses do.”
The legislation could have a significant impact on the state’s budget. The bill is designed to close the loophole that has allowed this tremendous profit to escape taxation for years. Updating the gross receipts tax to include digital advertising could raise $500 million annually in new revenue for the state. This revenue is likely to grow, with the digital ads industry projected to be worth $1 trillion in just five years.
“Every day, Pennsylvanians are exposed to digital advertisements that generate billions in profits for some of the world's largest corporations, yet those companies contribute little to nothing in Pennsylvania taxes on that revenue,” said Abney. “I am proud to support this legislation because Pennsylvania families and local businesses should not be left carrying the load while multinational corporations profit from our communities without giving back.”
“The Digital Advertising Tax ensures corporations and billionaires are paying more of a fair share of taxes, and it’s about time,” said Inglis. “There is still work to be done regarding fair taxes on the wealthy, but this is an exciting and overdue step in the right direction.”
According to a recent report by the Internet Advertising Bureau and PricewaterhouseCoopers, the digital advertising industry saw an almost 14% year-over-year increase in 2025. Alphabet (Google) and Meta are currently the two highest revenue earners from digital advertising, each reporting over $230 billion in revenue this year.
“These are the biggest, most profitable companies that are bringing data centers and all of the challenges to our commonwealth. 100% they should pay their fair share,” said House Majority Leader Matt Bradford, D-Montgomery.
Pennsylvania has one of the most regressive tax structures in the nation, with its poorest residents paying nearly double the tax rate of the wealthiest.
“The gross receipts tax dates back to the 1860s, and our Tax Code was codified in 1971. Who in 1971 anticipated that we’d all be carrying mobile phones in our pockets, watching Smart TVs, and getting ads on these and our computers all day long?” said House Finance Committee Chair Steve Samuelson, D-Northampton. “There’s a new report since our hearing on this bill, which shows that in 2025, digital ad revenue rose by 13.9%. This most recent report says that digital ad revenue is $294 billion nationwide. More than $11 billion of this revenue is derived from ads targeting Pennsylvanians.”
House Bill 1678 has 59 co-sponsors from across the Commonwealth. State Sens. Lindsey Williams, D-Allegheny; Nikil Saval, D-Phila.; and Katie Muth, D-Berks/Chester/Montgomery, have introduced companion legislation in the state Senate. The bill is part of the “Tax Billionaires. Fund PA” package.
The House bill now moves to the state Senate for further consideration.