Washington lawmakers propose tax on social media companies

State lawmakers in Washington are looking to help local journalism by introducing a new tax on large social media and search engine companies. The proposed legislation would apply to companies making over $5 million annually. It would cap the tax at $6 million a year and is expected to generate $27 million in the fiscal year 2027, with projections of $102 million between 2027 and 2031. The move comes as many newspapers struggle to survive in a digital age. Since 2005, over 3,200 newspapers have closed, averaging more than two closures a week. Alan Fisco, President of The Seattle Times, warned that small community newspapers are particularly at risk due to their reliance on print revenue. A recent report showed that Washington lost 24 weekly and three daily newspapers from 2004 to 2022, about 20% of its local news publications. Remaining newspapers have made cuts to staff and frequency of publication to stay afloat. Supporters of the tax, including former State Senator Karen Keiser, believe it will improve local news coverage. They argue that an informed public is essential for a healthy democracy. Conversely, opponents like Rose Feliciano from the technology trade association Technet argue that blaming social media for the decline of journalism is misleading. They suggest that solutions should focus on market adaptations rather than imposing new taxes. The tax passed out of the Senate Commerce Committee earlier this session. However, it still awaits scheduling for further discussion in the Ways and Means Committee.