How much for that free speech?

Just as I’m trying to figure out how to set up an online tip jar so that Don and I can spend more time on the blog and less time on work that pays money, I read that the Philadelphia city government requires blogs to be licensed. The City of Philadelphia expects bloggers to pay $300 for a business privilege license and, of course, pay taxes on any and all revenue that comes in from the blog.

The law amounts to a tax on free speech.

The city requires that anyone engaged in any activity for profit be licensed, whether or not the business actually turned a profit. Bloggers, and editorial writers across the country, argue that bloggers don’t intend to make a profit. We provide a digital microphone so that voices from the community can be heard. The type of change we seek does not jingle in pockets; ideally, it resonates among voters, who on the appointed day, will go to the polls and make change happen.

Pundits call Philadelphia’s law “management” as opposed to “leadership” and point out that the licensing requirement shows a lack of wisdom among those who make up Philadelphia’s governing body. Many municipalities are scrambling to find the money to meet their budgets. Still, the move seems akin to feeling around under the sofa cushions in hopes of finding enough quarters to go to the Laundromat.

We hope that Chapel Hill’s town council doesn’t latch onto this idea of licensing blogs. But once council meetings resume Sept. 15, we’ll be reading the consent agenda carefully, just in case.
– Nancy Oates

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  1. Isn’t any organization that collects money supposed to pay taxes unless it’s a legal non-profit? Newspapers pay taxes, don’t they? I don’t know about contributions – perhaps they fall into a different category?

    Special taxes only on blogs, or licensing the right to express your opinion on a blog are clearly against our ideas of free speech, it seems to me. But I wonder if you’ve just given the council an idea???

  2. Scott Maitland

     /  August 24, 2010

    There are many reasons I would be against licensing bloggers. Unfortunately, your argument- that Philadelphia’s law requiring “for profit” bloggers to acquire a license is a tax on free speech – doesn’t carry the day. First of all, under your stated rationale the Federal Government is already taxing free speech since any income derived from any venture is considered income for tax purposes. In effect, Freedom of Speech is the freedom to say what you want not the freedom to say what you want for free if you are making a profit off of it. Secondly, even though your product is thoughts and ideas, I don’t see how you can distinguish your blog – which you freely admit you are attempting to commercialize so that you can spend more time on it – from any other commercial business that is required to pay fees regardless of whether or not they make income.

    Your column touches on one of my key frustrations with society today. Society very rarely recognizes the positive cultural value of businesses. I love your blog. Your blog would be better if you could spend more time on it. The only way to spend more time on it is to make money off of it. In this way you are not unique from most small business people who seek to make the world a better place by engaging in a self-sustaining activity.

    The real issue here is Government’s insatiable desire to tax to justify its spending. I fear your post will have the unfortunate effect of giving officials a new target to tax.

    Keep up the good work!

  3. Don Evans

     /  August 24, 2010

    My main concern with a “blog tax” is that it will inhibit the free exchange of vital information, whether it’s news about your neighborhood or advice from co-sufferers of rare diseases. It’s a tax on sharing.

    Say you have a blog for folks with a rare disease and you’re handing out tips on dealing with the affliction from co-sufferers — practical information and support. There’s no advertising and no contributions other than time and advice. That $300 tax could stop you in your tracks. Now apply that to thousands of other blog sites that provide useful information and guidance for free and you can see that such a tax will only inhibit information and will make things worse.

    Perhaps lawmakers could do with some insight into the “do no harm” requirement attached to doctors. Given the effects of this lingering economy, however, I expect lawmakers will get very creative in their efforts to find things to tax. That’s why the lyrics to The Beatles’ “Taxman” have been wisping through my head since I learned about that blog tax — “If you try to sit, I’ll tax your seat/If you get too cold, I’ll tax the heat/If you take a walk, I’ll tax your feet/Taxman!”

  4. George C

     /  August 24, 2010

    I myself cannot imagine Chapel Hill or Carrboro, or even Orange County, considering levying a tax on bloggers. Now Raleigh on the other hand…

  5. When I started 5 years ago I made the decision to not monetize its content for various reasons. I’ve been successfully losing money ever since ;-)!

    Given your and Don’s backgrounds, your commitment to cover each Council meeting, it makes sense that you want to push into the commercial realm. I agree with Scott, though, that taxing a commercial venture doesn’t necessarily equate with stifling free expression.

    When I called for the end of our local privilege tax, I pointed out that 1) it wasn’t calibrated very well to the size of commercial activity, 2) the tax revenues weren’t tied to any purpose – including directly enhancing economic activity, 3) the overhead of collecting the revenue and monitoring compliance cut into the net returns to the point it was essentially a wash.

    Philly screwed up two ways: one, creating a fiscal nightmare that has it scrambling for revenues (does that sound familiar?) and, two, not calibrating its taxing regulations to the size of the commercial activity. One post I read said someone had generated $11 of revenue in 5 years so the licensure (tax) far outweighed the revenue. Crazy!

  6. Scott Maitland

     /  August 24, 2010

    Don, I agree that a blog that is not a commercial venture should not even be considered for a license and such a license requirement would be a tax on free speech. It is my understanding that the Philly law – which I object to on many other grounds including CitizenWill’s – only applies to commercial blogs. Consequently your hypothetical would not apply.

    It did just strike me that an “internet use” tax applied to individuals – which is supposedly a hoax but plausible enough to stay in our societal consciousness – could possibly be fought and defeated on First Amendment grounds.

    By the way, my “keep up the good work” in my last post was not ironic. I really mean it. Reading over my last post, I realized that it could have been misconstrued as a ironic comment about giving politicians ideas about what to tax. If you do go commercial, don’t forget to ask me about buying an ad. 😉

  7. John Ager

     /  August 24, 2010

    Nancy, this will all blow over. Philly is not being devious here or trying to start a free speech debate. They are simply ignorant. I bet they were shocked when this story went national.

    Small blogs are not worth chasing. Medium blogs can choose to relocate. Big corporate blogs (Huffpo et al.) can afford a license.

    Where’s the revenue?

  8. Fred Black

     /  August 25, 2010

    Agree with Will on the privilege tax, as it is deeply rooted in NC politics. Hence some are exempt and some pay it and the only rhyme or reason is who had to political juice to have their business category exempted.

    Our company pays it even though none of our work is in CH, but having a CH address grants you the “privilege” of paying it, and of course, you also pay the town to get your home business “authorized.” One can only guess how many small consulting and other businesses operating out of homes are not paying it. I guess it’s too expensive to try to enforce.