January 31, Government Report

• Maryland, Nebraska Look at Advertising Taxes
• Privacy, Self-Regulation Update
• CA Do Not Sell My Info
• Political Ads: Required Disclosures

On January 29 the Maryland Senate Committee on Budget and Taxation held a hearing on SB 2which would place a gross receipts tax on digital advertising. AAF Baltimore President, Matt McDermott and AAF EVP of Government Affairs, Clark Rector both testified against the proposal. 

While the bill targets global companies with digital advertising revenues over $100,000,000 McDermott explained how the tax would ultimately also hurt Maryland businesses and consumers. Rector used the opportunity to remind Senators of the importance of advertising to Maryland and how digital advertising gives both small and large Maryland companies the ability to compete far beyond the state’s borders. Both received favorable coverage in the Baltimore Sun.

The next steps for the bill are uncertain, but because it is sponsored by the current and former Presidents of the State Senate it must be taken seriously.  

Two ad tax bills have been introduced in the Nebraska legislature. LB 946 would extend the state sales and use tax to all services unless specifically exempted. No exemption for advertising is mentioned in the bill’s language. LB 989 would impose the sales and use tax to digital advertising. Because Nebraska has a very short legislative session this year, and the governor has pledged not to raise taxes, these bills are not expected to be enacted. However, many observers in the state believe that they could lay the groundwork for more serious consideration next year. In March, AAF Omaha and AAF Lincoln will host their annual joint legislative reception. The proposed ad taxes are sure to be a subject of discussion.

AAF and our allied advertising associations have asked California Attorney General Xavier Becerra to delay enforcement of the California Consumer Privacy Protection Act. The new law went into effect on January 1 of this year with enforcement set to begin on July 1. Unfortunately, the final regulations have not been finalized, leaving thousands of covered companies in a state of uncertainty as to what exactly they will be complying with. The letter asked that the Attorney General delay enforcement actions until six months after the regulations are finalized.

While the industry waits for final rules, the Digital Advertising Alliance, in which AAF is a founding member, has created several new resources to help advertisers, publishers, agencies and ad tech companies in their compliance journey.

With California’s “Do Not Sell My Personal Info” (DNS) mandate, DAA saw an opportunity to advance a privacy control experience for consumers that mirrors what’s been in market for the better part of a decade for opting out of data collection for interest-based advertising (IBA) with WebChoices and AppChoices. 

DAA’s new DNS tools for California citizens—built into the latest version of its AppChoices mobile app, and browser-based “Opt Out Tool” that is similar to WebChoices—enables third parties (ad tech) to complement first parties (site and app owners) in their own opt-out “do not sell my personal information” regimes for consumers.  

Overarching all of this is a new Privacy Rights icon that publishers can use on their sites and apps to extend transparency regarding their data “sales” practices—again mirroring the ubiquitous YourAdChoices icon they already see on footers and app settings for hundreds of companies and thousands of brands regarding data used for interest-based advertising.

While AAF strongly prefers a single national standard for data privacy, we are pleased to see these new CCPA-focused tools come to market. The goal is to help advertisers, agencies, publishers and ad tech companies manage this “new” privacy mandate and novel aspect of law. It is very possible other states could mimic what California has done.

DAA has rolled out a new Resources section related to the new Privacy Rights icon that publishers may use to convey their CCPA and “Do Not Sell My Personal Info” option(s) and disclosures on their digital properties and link to DAA’s DNS Opt Out Tool—both browser-based and app.  Web forms to license the Privacy Rights icon and participate in DAA’s CCPA opt out-related tools are available there. The slides from the AAF/DAA privacy webinar are available there, with the full webinar available on the AAF website.

Meanwhile, as 50 states may further consider their own efforts to legislate in 2020—with new laws taking effect in California, Nevada and Maine as the last quarter and New Year passed—it’s paramount that we all work to manage the emerging patchwork. AAF and DAA are helping to drive the Privacy for America initiative to enact a comprehensive U.S. federal privacy law built upon a pragmatic, principled policy framework.

January 1, 2020, marked another milestone for DAA:  its Political Ads transparency and accountability program is now enforceable by DAA’s independent Accountability Partners. As we enter a Presidential Election year, we have a responsibility to make sure online “express advocacy” ads for state and federal offices deliver transparency to voters—by helping to ensure these political ads we see are placed by valid, registered campaigns. 

Using the Political Ads icon—which is free to license (subject to qualification)—and the associated disclosures that must accompany such digital political ads, we can help promote integrity in our elections.

In short, political ads need to be transparent and accountable. And already several ad tech companies are making sure that the DAA Political Ads icon and disclosures are deliverable—and much the same way they facilitate the YourAdChoices icon with interest-based ads.

And to voters, the DAA team continues to keep a campaign-lookup data base up to date, always-on, and connected—a click or two away for voters to use to see if a particular campaign is actually registered in their home state.

The AAF protects and promotes advertising at all levels of government through grassroots activities. Our nation-wide network monitors advertising-related legislation on local, state and federal levels. We put our members face-to-face with influential lawmakers while encouraging self-regulation as a preemptor to government intervention, when appropriate of course. To learn more about our advocacy efforts, click here.