Chicago Begins Taxing PlayStation Users Because… Chicago

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While the winter holidays usually mark the season of giving, PlayStation users in Chicago won’t have as much available in their budgets this year. Starting last month, gamers who use the Sony services to stream content will have to pay more thanks to a 9 percent tax that is levied by the city.

The PlayStation streaming services are just the latest additions to the list. Companies like Netflix, Hulu, and Spotify have had to comply with the levy already as, according to a report by the Chicago Tribune, it officially began three years ago.

Chicago’s amusement tax originally applied mostly to purchases related to live events, such as concert and sport tickets. In 2015, the charge was extended to include streaming services, including music, video, and games.

Some tech companies decided to fight against the tax. In August, Apple filed a suit, alleging that the tax on its music streaming service was discriminatory and illegal. Since the lawsuit is still pending, Apple is not currently collecting the 9 percent tax.

Users also made themselves heard in 2015. A group that includes Amazon Prime, Netflix, Hulu, Xbox Live, and Spotify customers sued the city of Chicago as well, claiming that the tax is a violation of federal law.

One of the points featured in the suit is that the tax applies to users who have billing addresses in Chicago. This means individuals who list Chicago as the billing address but do not use the services in the city are still subject to the 9 percent tax.

A judge sided with the city in May, though the group is appealing the decision.

Chicago Law Department spokesman Bill McCaffrey released a statement saying that the city “uniformly enforces the amusement tax.”

“If a business is not collecting the tax where we believe it applies, the city takes the necessary steps and works with the company to ensure compliance with the law,” he added.

It isn’t clear why PlayStation just began collecting the tax in November, and a spokeswoman for the company declined to comment on the matter.