Downloadable games could receive tax in Connecticut

Connecticut has taken a strong step forward in breaking into another market for taxation, introducing a bill that would apply sales tax to virtual goods, including downloadable games. The new bill would levy a tax on various formats and mediums such as "digital movies, books, music, ringtones, audio and video works and similar downloadable products."

The bill, already approved by the State Senate, will ensure that the 6.35 percent sales tax for the state is applied on all downloadable transactions. This has of course garnered a response from the Entertainment Consumers Association, which argues such a tax is "not the right way to aid an economic recovery."

The ECA is fighting an uphill battle. Already, almost half of all US states have some sort of tax on downloadable purchases. The new law is expected to take effect July 1, if approved by the Senate, and will apply to any and all sales that are recorded digitally. Retailers around the state will have to apply sales tax, or leave consumers with the task of reporting and paying taxes on any such purchases.