Thursday, October 29, 2009
The (B)Ad Tax Idea That Won't Go Away
The AAF estimates that disallowing the advertising tax deduction would increase the costs of advertising and marketing for affected companies by up to 35%. The ad industry provides $6 trillion in annual sales in the U.S. and 21 million jobs, according to the AAF. - Ad Age; October 21, 2009
Fortunately for the advertising industry, they not only have the AAF and its lobbying efforts trying to persuade legislators to drop this idea, but they have also gotten support from broadcasters and newspapers. These "traditional media" outlets would certainly feel the effects from significantly reduced or even eliminated advertising budgets at a time where they are already fighting over those same dollars being dispersed amongst "new media" outlets such as social media, blogging, and the web. Taking into consideration that it is highly likely that there will be a "government provided" health care option for Americans, our elected officials in D.C. need a plan to pay for it.
Representative Charles B. Rangel, Democrat of New York and chairman of the House Ways and Means Committee, said last month that legislators would consider ending the tax break for drug ads as a way to raise money to pay for the health care overhaul. - New York Times, July 26, 2009
Some legislators are not only using this logic to pay for the "government provided" health care option, but also a way to express their disapproval with this form of advertising entirely.
The proposed legislation to eliminate the tax deduction for health-care advertising is going under the short title of the "Protecting Americans from Drug Marketing Act." - Ad Age; October 21, 2009
Most of us may not have pharmaceutical companies as clients, but the fear amongst many is that it won't stop there.
"Where does one draw the line?" One United States Senator has asked. Would we also tax advertising for vehicles that do not meet emissions or fuel economy standards, advertising for gaming, or foods that do not meet some nutrition standard? - AAF; October 20, 2009
What can we do? Please contact both of your Senators as soon as possible and express your strong opposition to any effort to deny the deductibility of advertising expenses. Some of the names associated with this legislation are: Senators Al Franken, D-Minn., Sherrod Brown, D-Ohio, and Sheldon Whitehouse, D-R.I., Bill Nelson, D-FL, Representatives James P. Moran, D-VA, Charles B. Rangel, D-NY.
Senators can be contacted through the Senate webpage at http://www.senate.gov/ or by calling the Senate switchboard at 202-224-3121.
UPDATE:
Congressman Targets Food Advertising Congressman Dennis Kucinich, D-Ohio, has sent a “Dear Colleague” letter to other members of Congress announcing his intention to introduce legislation to “eliminate the tax deductibility of fast food and junk food advertising directed at children.” The Congressman is inviting other members to join him as a cosponsor.
The removal of any advertising tax deductions will certainly open the flood gates and make the entire industry vulnerable.
Helpful links:
AAF, Alert: Another Threat to Advertising Deductibility
Franken and Senate Democrats Go After Tax Deduction for Advertising
Lawmakers Seek to Curb Drug Commercials
House Considering $37 Billion Drug Tax, Rangel Says
Friday, June 19, 2009
Twitter Rally to fight Harmful Legislation
It's time for a National Twitter Rally!!!
U.S. Congress is considering legislation that could hurt the advertising industry by eliminating the current tax-deductibility of advertising costs as a normal business expense for pharmaceutical companies — which could begin a slippery slope of removing the lack of service tax that our industry depends on. (see previous post for full details)
Please join our Twitter Rally to let the House and Senate know how you feel! Be POLITE, and tell them where you stand.
FLORIDA
Senator Bill Nelson - http://twitter.com/senbillnelson
Senator Mel Martinez - http://www.twitter.com/MelMartinez
Rep. Kendrick Meek - http://www.twitter.com/kendrickbmeek
NATIONWIDE
U.S. Congress Twitter Directory – http://tweetcongress.org/
EXAMPLE TWEETS
@SenBillNelson Health care reform is important, but so is my advertising job. Please fight for our rights in DC. #NoAdTax
@kendrickbmeek Please keep advertising deductible. My future depends on it. #NoAdTax
@MelMartinez Advertising fuels our economy. Please keep it deductible for Rx companies! #NoAdTax
Legislation Could Harm Advertising Industry
The Senate Finance Committee today is discussing revenue options for financing healthcare reform, including whether to tax advertising. The proposal under discussion would deny the business expense deduction for the cost of the advertising of prescription medicines.
Because healthcare reform is moving very fast, and Senators communicate with each other it is vital that ALL Senators hear strong opposition TODAY to this proposal from their constituents. Please circulate this alert to your ad club members and/or employees and urge them to place calls.
The core of your message should be that the proposal must be opposed because it is a tax on advertising and if adopted is unlikely to stop with prescription drugs. Who knows what might be next when the government needs more money? Advertising for all products and services helps generate $6 trillion in economic activity and supports more than 21 million jobs.
More detailed arguments are listed below, as is a link to the contact information for the key member of each Senator's staff. Again, it is vitally important that you circulate this alert and make your calls today. Thank you for your help with this important matter.
Limiting advertising deductibility of pharmaceuticals should be opposed because:
· The Tax Code and its deductions should be applied equally to all ordinary and necessary business expenses. Even at the height of public criticism of the tobacco industry, Congress did not discriminate between the treatment of the cost of advertising tobacco products, which is fully deductible, and the cost of advertising other products. Some may recall that Congress "affirmed" a ban on television and radio advertising of tobacco products. But it did so after the industry elected to withdraw this advertising rather than face government sponsored antismoking ads. This also took place before the Supreme Court had enunciated the doctrine that protects commercial speech under the First Amendment.
· The underlying goal of eliminating the deduction for advertising prescription medications is very straightforward – it is to make speech about the product more expensive. That will assure there is less advertising, and less advertising will result in fewer sales of the advertised prescription medications, particularly to Medicare Part D eligible patients. In other words, Congress would be taxing speech to save money on a federal program of spending.
· The denial of the deduction would make this advertising 35 percent more expensive (assuming the top federal corporate tax rate). Assuming that the affected companies do not have wealthy uncles or unlimited supplies of spare cash, they likely will reduce their advertising by a similar amount, resulting in a loss of speech to consumers. Thus, the loss of the deduction is no more than a tax on advertising.
· In Grosjean v. American Press Co., Inc., 297 U. S. 233 (1936), the U.S. Supreme Court struck down a 2 percent Louisiana tax on newspapers with more than 20,000 circulation per week. The 13 affected newspapers were critics of Governor Huey Long and sued to challenge the tax as an unconstitutional tax on speech. The U.S. Supreme Court agreed.
· Section 162 of the Tax Code provides for the current deduction of all ordinary and necessary business expenses. This section applies to all such expenses – rent, utilities, salaries, and every form of daily business operation. Virtually all advertising costs are ordinary business expenses. Imagine the world of business however, if Congress were to pick and choose favorite products – products that would get the deduction and products that would be denied the deduction. What else might be on the hit list? For example, would generic drugs be entitled to the deduction, but not brand drugs? What about vehicles that cannot achieve the efficiency of 20 miles on a gallon of gas? What about a bank that fails its stress test?
Wednesday, February 27, 2008
AdCast: Episode XVI
The Tampa Bay Performing Arts Center is definitely one of our favorite organizations in the area—both for the great things they bring to the city, and the great people they send our way. This time our guests were the lovelies Kari Goetz and Christen Pettitt, and the topic was Avenue Q. They came on to tell us what that means (Hint: It's a sweet Broadway Show coming to TBPAC) and how Ad 2 can get a great deal on it.
VIEW NOW
Next we got to find out what we'd gotten ourselves into, with the Gasparilla Film Festival's Chad Moore and John Rosser. They told us all about one of Tampa's great cultural attractions, and tried to forgive us for crashing it (well actually I think they kinda liked us).
VIEW NOW
Having gotten our feet wet, we now dove deeper into the Festival's substance, bringing on some real live independent movie makers. Adam Sigal and Brahman Turner created one of the featured films of the event—a piece called Daydreamer. What followed was some interesting insight into how it all came to be.
VIEW NOW
Man, if you like film, this was the show for you. Our next guests were Pete Guzzo and Dan Brienza, who told us about Tampa's upcoming Weekend Film Workshop. It sounds like a great event for aspiring film-makers, covering all the aspects of making it happen in film. And... action!
VIEW NOW
Continuing with our film theme, we brought Erik Cattele and Adam Lenfest of Polycreative on next. Polycreative is a digital media producer in the area, and one of the most prominent members of Tampa's Digital Media Alliance.
VIEW NOW
We did a little something different with our last segment. No film here; just funds. Josh Crum is a Business Development Assoicate for Raymond James Financial, and one of this month's Rising Stars. He came on to tell us about his work with financial advisors and independent contractors that's brought him to Rising Star status.
VIEW NOW
You know we're eternally greatful to the sponsors. As always, it simply couldn't happen if it weren't for the folks at Tampa Digital Studios, and the help of La Casa Dolce and tbt*. And for this month, "props" to Tampa Theatre and the Gasparilla Film Festival for letting us team up with them.
Until next time, make good choices!
Sunday, February 10, 2008
Ad 2 Road Show
With the visual assistance of a projected powerpoint presentation, Jeff started by explaining what Ad 2 is, what we do for the community, and types of the events Ad 2 puts on. He also discussed the value of networking and different types of opportunities Ad 2 has to get involved in. Kate then spoke specifically about the upcoming Fall Media Tour and the importance of participating in the Student ADDY Awards. Students were shown a reel of the local Student ADDY Award winning work from the last two years. Students were greatly encouraged to enter their work and attend ADDY Gallery Night, an evening showcasing all of the ADDY entries in both the professional and student divisions. Each Road Show presentation ended with a question and answer session.
Strategically timed to take place right before the Fall Student Media Tour, we credited the Road Show as a major factor in selling out the fall tour. In the months preceding the Road Show we noticed a dramatic increase in student attendance at our monthly meetings. There was also a large student presence at other various Ad 2 and advertising community events including AdBash, ADDY Gallery Night and the ADDY After Party. The Road Show has also been credited by students and professors as a main factor in the dramatic increase in Student ADDY entries this year. In previous years the Tampa Bay Ad Fed has received between 30 to 40 Student ADDY entries. This year they received a record breaking 109 Student ADDY entries and had more Student ADDY winners than ever before.
Wednesday, January 30, 2008
AdCast: Episode XV
It's a new name, a new look, and more for one of Tampa Bay's most important organizations. Fresh off the unveiling of their complete re-branding roll-out, Tampa Bay & Company sent Senior VP of Marketing Dianne Jacob to tell us all about it. Check out why they did it, how they went about it, and what they're doing to get it out to the public on this segment.
VIEW SEGMENT
Mmmmm Chipotle... next up we had Kimberly Higgins, the official "Chipotle Cheerleader" for Tampa Bay and Orlando. You might recognize her from the amazing turnaround she orchestrated for about 50 students on our most recent Media Tour, or from her Rising Star status of months past. Tonight she let us in on all her crowd-pleasing promotional secrets.
VIEW SEGMENT
The Addys are upon us! They seem to come sooner every year for those of us that have to prepare our entries, and a couple of the local authorities on the subject were here to make the announcement this time. Tampa Bay Ad Fed president and Maddux Business Report marketing manager Craig Neuman, along with art director Kate Whatley of PeakBiety Branding + Advertising, came on to give us the low-down on the big show.
VIEW SEGMENT
And now for tonight's Rising Star! A great new addition to our show over the last few months has been the tbt* Rising Star. This time around, we had a lawyer in the house. Nicole Kibert is an Associate Attorney for Carlton Fields, and tonight we found out what she does and how she does it so well.
VIEW SEGMENT
As young, opinionated people in the advertising community, we always like to add our insight on the subject. This time it was Vinny and Lindsey telling us about their expectations for the star-studded ads of this year's Super Bowl. See what they had to say in our latest Advertising Insight.
VIEW SEGMENT
We wrapped things up with Ad 2 Roundtable, where we bring on Ad 2's finest to let us in on the club's latest. With that said, check it out and find out what you need to know!
VIEW SEGMENT
As always, we gotta thank those that made it all possible for us. Tampa Digital Studios ran the show, Tampa Bay Brewing Co. hosted it, and the folks at tbt* and La Casa Dolce sponsored it. Great job to all, and don't forget my strong encouragement for you all in three simple words—Make good choices.
Monday, December 3, 2007
AdCast: Episode XIV
• We kicked things off with the "homies" as usual. This time it was Cris Vatalaro and Mai Tran coming on to talk about two of Ad 2's biggest annual events, the Student Media Tour and AdBash. I'm not over-exaggerating when I say that both were extremely successful this year, both for entertainment value and for raising funds for our Public Service client, Wheels for Success. There's also a nice little highlight reel of AdBash, prepped by Mike Compton and the folks at Tampa Digital Studios: VIEW NOW
• Next on the show we started off our sports theme with America's favorite past-time. Brian Killingsworth, Director of Marketing and Promotion with the newly re-branded Tampa Bay Rays, was on the show with us. Brian told all about the re-branding efforts, which pretty much spread to every aspect of the team and its interaction with the city. Cheers for all the great community involvement coming out of that organization, and best of luck with the new image. VIEW NOW
• Time to talk about the Lightning and Storm! We don't have a weather center at AdCast, so that can only mean one thing - We're talking about more Tampa Bay sports. Brad Lott is the VP of Sales and Marketing for the Tampa Bay Lightning, and he brought us up to speed on all the defenders of the St. Pete Times Forum. VIEW NOW
• In a world where college bowl games seem to creep out of forgotten corners of the couch, we're lucky to have one of the best and longest-lasting of these events here in Tampa Bay. Mike Shulze is the Director of Communications + Sponsorships for the Outback Bowl. He gave us the play-by-play on everything from how its promoted to even revealing one of this year's teams live on the air - That's right, you heard it here FIRST. VIEW NOW
• The Society for Marketing Professional Services. What does it all mean? As we found out, it's an organization that focuses on training, networking, and community involvement for those in the fields of construction and engineering. Members Tara Ryan and JR Kozera were live on the air to tell us more about all the great things they do as an organization. VIEW NOW
• What are you doing for the holidays? Let us give you the run-down. Ad 2's very own Cris Vatalaro went to the trouble of researching, inspecting, deliberating to bring us the biggest and best in upcoming events in Tampa Bay. She even drug in Dan Gorda from 13 Ugly Men to tell us about their next extravagant event this New Years Eve. VIEW NOW
• And of course, there's our tbt* Rising Star segment. Every week, they crown a lucky individual in Tampa Bay and give them a proper feature in their lovely publication. We went through this month's winners, and brought one on the show. Sharon Nobles is a realtor with Wingate & Associates, but that's not all. Find out everything she's got going on, right here. VIEW NOW
Thanks to everyone that keeps watching the show... all the faithful that stayed with us through my worst wardrobe follies and love us just the same. And I can't stop raving out our great sponsors - La Casa "Delicious" Dolce, tbt* (something worth reading!) and of course the blood, sweat, and tears of Tampa Digital Studios and their elite production force. Oh and Tampa Bay Brewing Company. You guys rock, and so does your beer.
And in closing, it just wouldn't be the same if I didn't keep you to it:
Make Good Choices.