Apple isn’t amused by Chicago’s amusement tax

Apple has lodged a complaint against the city of Chicago over its 9% amusement tax, alleging the tax and a city Finance Department ruling extending the tax to streaming services violate the U.S. and Illinois constitutions and the Internet Tax Freedom Act.

Focusing on its music streaming service, Apple alleges that Chicago’s amusement tax is illegal, arguing in a complaint filed with the Cook County Circuit Court on Monday the tax is discriminatory toward electronic commerce and imposes an undue burden of forced tax collection.

Section 4-156-020 of the Chicago Municipal Code imposes a tax upon the patrons of every amusement within the city. The tax is based on the admission fees or other charges “for the privilege to enter, to witness, to view or to participate in the amusement.”

What is an amusement? In general, all entertainment or recreational activities offered for public participation or on a membership or other basis are amusements subject to the tax. Examples of taxable fees or charges, include but aren’t limited to those for sporting events, concerts, movies, cover charges, pub crawls, sport and social clubs, tours, cruises, etc.

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