Wednesday, August 25, 2010

Philadelphia Bloggers Facing Tax

By Mitchell Schmale

The City of Brotherly Love has been in the headlines recently for not showing a lot of love to bloggers located in Philadelphia.

The uproar began when Philadelphia’s city revenue officials sent letters to local residents who had reported income with the IRS, but had not paid for a business privilege license in the city. The license fee of $50 per year or $300 for a lifetime, with additional taxes on profits, allows business owners to operate a business in the city. The list of local residents included bloggers in the city who made income from their blogs (no matter how small) by charging for content, ads, etc.

Philadelphia bloggers were outraged by the attempt to collect taxes and claimed that the fee, as well as additional taxes on their limited earnings, would infringe on their capability to run their small blogs. Many bloggers claim that their use of the Internet is a free speech issue and that the earnings on their blogs is often not enough to buy a couple of cheese steak subs. In fact, one Philadelphia blogger claimed he had made only $11 on his blog in a year.

City officials, however, have made it clear that the tax only affects bloggers charging for a service or advertising and not blogs that are strictly a hobby or personal that share content and opinions for free. City officials also contend that the privilege fee is in place for businesses of all sizes and industries, not just bloggers.

The debate will continue on whether Philadelphia tax officials are being too aggressive in pursuing tax dollars from all possible sources, or if their efforts are hindering free speech and the ability of local residents to blog and share their opinions on the Internet.

In the meantime, city officials in Philadelphia are looking at the issue more closely for bloggers in proposing legislation that would keep the fee for the business license, but would limit when the additional taxes on profits kicks in. Until then, the war of words will rage on in the Philadelphia’s blogosphere while the bloggers keep blogging and the tax officials keep collecting.

Mitchell Schmale is the Vice President of Business for Maroon PR. Contact him at

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