The Insights Association (IA), the leading nonprofit trade association for the market research and data analytics industry, is urging the District of Columbia to reject a proposal that would tax consumer data.
In an October 16, 2023 letter to the DC Tax Revision Commission, IA expressed the industry’s “strong opposition to your consideration of SE1, the proposal for consumer data excise taxes in the District of Columbia,” urging commissioners to either reject the proposal or to carve out market research.
“Consumer data excise taxes are severely misguided. Rather than primarily targeting “big tech” companies, they would primarily hurt most small businesses that operate in the District.
As you may recall, the DC City Council proposed an advertising and data tax in 2020 that would have hurt every user and practitioner of market research, big or small, for-profit or nonprofit. The Council ultimately realized this, and ultimately did not pass it into law. What the DC Tax Revision Committee is currently considering would have the same catastrophic impacts.
A tax on consumer data would fall on insights service providers, resulting in increased costs to conduct market research studies, resulting in fewer companies and organizations seeking to purchase studies in DC or conduct them there. This would also neuter the District’s voice in the development of products, services and ideas. All manner of organizations rely on the insights generated by these studies to understand the wants and needs of their consumer / customer / stakeholder bases. The new tax would increase the cost of planning and decision-making, disincentivizing the insights essential to economic growth and bouncing back from crises.”
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