AD TAX DANGER RESURFACES, THIS TIME IN TEXAS

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Almost a decade after the state of Florida made advertising a tax target, there are fears the scenario could be repeated, this time in Texas.

With Texas Gov. George W. Bush firmly against a state income tax, a state task force that included representatives from the House speaker, the lieutenant governor and the state comptroller recently released a report suggesting a sales tax on advertising media would bring in nearly $151 million in additional revenue annually.

Advertising was listed as one of about 70 possible areas of sales tax gains; others included newspapers, newspaper inserts and magazine subscriptions.

The report will be considered in hearings this fall. Legislative action could happen next year at the earliest. That time frame, however, does nothing to lessen the worry of some ad groups.

"It's not just ho hum. It's a significant deal," said Dan Jaffe, exec VP of Association of National Advertisers.

He said one reason Florida approved legislation in 1987 was that the threat of the tax wasn't taken seriously enough by advertisers, ad agencies and media groups. While the groups did organize strongly after Florida passed the measure, and eventually got it repealed, the fight was long and expensive.

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