Beginning Nov. 1, Spotify will begin charging sales tax on South Dakota users’ monthly subscription fees.
The tax will be “no more than $1.13 per month depending on your current ZIP-based sales tax and Spotify subscription plan,” and will be added on top of already existing fees, said the email sent by Spotify to South Dakota subscribers.
Existing fees for a monthly Spotify subscription range from $4.99 for students and $9.99 for regular users.
Spotify is required to collect sales tax on their subscriptions by state and local governments, according to the Spotify customer help website.
“Some state and local governments may also require us to collect sales tax if Spotify undergoes marketing/promotional activities in the state or locality, or uses local sales agents or consultants,” the website said.
Emma Lavin, a first-year business major and a Spotify subscriber from South Dakota, said although she was unaware of the sales tax addition, she finds it “weird” that South Dakota will be charging sales tax to online services.
“It’s not a big deal, but I don’t think it’s really necessary,” Lavin said.
Other states that already charge this sales tax on digital entertainment services include Illinois, Pennsylvania, Washington, Florida and North Carolina.