On January 14, LB 989 was introduced in the Nebraska
Legislature, which would impose sales and use tax on "the
retail sale of digital advertisements." The bill defines
"digital advertisement" as "an advertising message
delivered over the Internet that markets or promotes a particular
good, service, or political candidate or message" (see pages
5-6 of the bill). The definition is a sweeping one, but the exact
scope is unclear as the terms used are not further defined. It is
also unclear how a taxable digital advertising transaction would be
sourced if the proposed legislation is enacted.
The digital advertising tax proposed in the bill would have an
effective date of October 1, 2020. Nebraska's state sales tax
rate is 5.5%, with local sales taxes up to an additional 2%.
