Advertising Taxes

Taxes on Advertising, Whether State or Federal, Inhibit Economic Growth and Raise Prices for Consumers

Every dollar spent on advertising and marketing by ANA members is fully deductible from federal corporate income tax as an "ordinary and necessary" business expense, as advertising is deemed as essential to business as office space, staff, equipment, research and development, and other expenses that help generate income and drive sales.

ANA works tirelessly to preserve this deduction on both the federal and state levels. We continue to fight for the full federal deductibility of advertising expenses, as has been permitted since the inception of the federal corporate income tax in the early 20th century. On the state level, we strongly oppose efforts to tax any aspect of the advertising process.

Read our July 2024 one pager about potential federal and state ad tax threats.

IHS Markit Study Demonstrates the Importance of Advertising to the U.S. Economy

ANA and The Advertising Coalition (TAC) have released a new study conducted by IHS Markit that demonstrates the importance of advertising as a driving force in the United States economy.

Among the findings:

• Advertising supported $7.1 trillion in sales activity in 2020 — 19.4 percent of total U.S. economic output.
• Each dollar spent on advertising expenses generates about $21 of sales.
• Advertising supported 28.5 million, or 19.5 percent, of the 142 million jobs in the U.S. in 2014.
• Every $1 million spent on annual advertising expenses supports 83 American jobs.
• Every direct advertising job supported another 51 jobs across all industries.
• The average salary for jobs ultimately supported by advertising was 12 percent above the national average.

While these findings cover the U.S. economy as a whole, the study also breaks down the importance of advertising to the economies of every state and Congressional district nationwide. This study is an important tool in helping ANA and TAC educate members of Congress and the executive branch on the role advertising plays in sustaining the U.S.'s economic vitality.

• Read a summary of the key findings of the report (PDF)
• Download the full study (PDF)

Keep Track of What’s Happening

To find out more about a specific proposal to tax advertisers, please visit our federal legislative tracking page, utilize the state legislative monitoring service provided to all ANA members, and sign up for ANA Government Relation’s weekly newsletter, The ADviser, by emailing washington@ana.net.