Comcast Sues Washington State Over Advertising Sales Tax

Comcast has filed a lawsuit in Washington state challenging a new law, SB 5814, that imposes a sales tax on advertising services, set to take effect October 1, 2025. The company argues that the law violates the federal Internet Tax Freedom Act by unfairly targeting internet-based advertising services while exempting most traditional advertising formats, creating discriminatory taxation. The law, signed by Governor Bob Ferguson, is a key part of a broader tax package expected to raise $1.1 billion over two years to help balance the state budget. Comcast's lawsuit, filed in Thurston County Superior Court, seeks a declaratory judgment to invalidate the law, warning that overturning the tax could force significant adjustments to the state's fiscal plans, as the tax on advertising services alone is projected to generate $475 million over four years. The dispute highlights tensions between state efforts to expand tax revenue and federal protections against discriminatory taxes on electronic commerce. State officials are reviewing the lawsuit with legal counsel, while Comcast declined further comment beyond outlining its concerns.