Reed Smith Client Alerts

Summary

On May 24, 2018, a Circuit Court of Cook County judge ruled for the City of Chicago on cross-motions for summary judgment that the City’s “amusement tax” may be lawfully imposed on Internet-based streaming services (for example, videos, movies, music, and videogames) billed to customers with an address in Chicago.

Authors: David P. Dorner Jeremy P. Gove

Facts

Chicago imposes a 9 percent amusement tax on admissions fees and other charges for entering, viewing, or participating in “amusements.”1  On June 9, 2015, the Comptroller of Chicago issued Amusement Tax Ruling #5 (applicable to periods on or after September 1, 2015) (the Ruling), extending taxable amusements to include “charges paid for the privilege to witness, view or participate in amusements that are delivered electronically” such as video, music, and online games (collectively, streaming services).2  The tax applies to taxpayers “whose residential street address or primary business street address is in Chicago, as reflected by their credit card billing address, zip code or other reliable information.”3