Adult download tax proposal awaits climax in Albany

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Adult download tax proposal awaits climax in Albany

BY Stephanie Gaskell
DAILY NEWS STAFF WRITER

Updated Monday, February 16th 2009, 9:53 AM
Governor Paterson wants to tax Internet porn on top of music and movie downloads. Diver/Getty

Governor Paterson wants to tax Internet porn on top of music and movie downloads.

A state proposal to add a 4% tax for downloading movies and music will also apply to Internet porn.

Gov. Paterson recently suggested the so-called iPod tax to help close a $15 billion budget deficit, but few realized the levy would also apply to XXX-rated material.

The skin industry denounced the move as a cheap political stunt.

"The last thing any of us need isan additional tax," said Steven Hirsch, the CEO of Vivid Entertainment Group and self-proclaimed King of Porn. "These are very difficult times and nobody can afford to lose even one customer."

The new tax technically isn't a sin tax, since it applies to all "digitally delivered entertainment services."

It would also apply only to businesses located in New York State, leaving some to wonder if companies would relocate to avoid the tax.

A manager at DVD Video in Times Square said porn lures tourists to New York and helps boost the economy.

"When the tourists come, they come to us to buy things. We want to bring people here. We will make money, which is good for everyone," the manager said.

A cashier at World of DVD in Times Square said business has been falling during the past year.

"Customers already say they have no money," the cashier said.

Conservatives railed against the tax, but for a very different reason.

"By taxing it you're legitimizing it," said New York Conservative Party Chairman Michael Long, adding that government shouldn't profit from porn. "If you're taxing it - how can it be wrong? I don't know how you can sink much deeper."

State officials defended the proposed tax and said it has nothing to do with legitimizing porn.

"This is simply bringing the tax code in line with technology," said Matt Anderson, a spokesman for the state Division of the Budget.

"Regardless of whether or not an item is purchased at a brick-and-mortar store or online, it would be treated consistently."

Paterson also said last night that the rich will "share in the sacrifice" of closing New York's budget gap.

Paterson, in language almost identical to that used by supporters of the so-called millionaire's tax, said the wealthy will not be spared.

"Every New Yorker will share in the sacrifice to get this budget balanced," he told the New York State Association of Black and Puerto Rican Legislators.

Paterson has previously argued that spending cuts - not a new tax on the wealthy - should be the priority. His spokesman said the governor's new comments did not represent a shift in his position.

sgaskell@nydailynews.com

With News Wire Services and Phillip Molnar