N.Y. Gov Dumps Download Tax Proposal; Legislator Proposes 'Pole Tax'

ALBANY, N.Y. — New York Gov. David Paterson has announced that he will drop a proposed tax on Internet downloads — including downloads of adult material —and use money from the recently-passed stimulus package to help close the state's growing deficit.

Wisconsin legislators approved a 5 percent download tax in February.

Last December, Paterson had called for 88 new fees, including taxing the sale of downloaded music and other "digitally delivered entertainment services" in a bid to wipe out a $14 billion budget gap. Under the proposals, movie tickets, taxi rides, soda, beer, wine, cigars, massages and health club memberships would all have been taxed, generating an estimated $1.3 billion.

"The proposed tax increases we are eliminating today were only put forward as a last resort when the deficit ballooned to an unprecedented level," Paterson said.

While the governor was dropping his plan for download taxes, Brooklyn Assemblyman Felix Ortiz introduced a bill that would require gentlemen's club patrons to pay the state $10 every time they visit.

Ortiz said the fee could raise as much as $500 million, which would be earmarked for victims of human trafficking, domestic violence, sexual abuse and child prostitution.

"We have to protect people who have been victimized by unscrupulous individuals, and we cannot continue, especially in this economy, to have government pay for everything," Ortiz said.

Ottiz' bill has yet to find a sponsor in the state senate.