Chicago Will Start Applying 9 Percent "Netflix Tax"

Using Netflix in Chicago is going to cost a bit more, thanks to the "Netflix Tax."

Chicago's Department of Finance is applying two new rules that would impact companies like Netflix and Spotify. One covers "electronically delivered amusements" and another covers "nonpossessory computer leases"; together they form a unique and troubling new attempt by cities to tax any city resident that interacts with the cloud, DSL Reports reported.

The streaming service providers will have to start collecting the tax starting September 1.

Reportedly, the new tax will net the city of Chicago an additional $12 million annually.

"The amusement tax applies to charges paid for the privilege to witness, view or participate in an amusement,"city's new ruling (pdf) read. "This includes not only charges paid for the privilege to witness, view or participate in amusements in person but also charges paid for the privilege to witness, view or participate in amusements that are delivered electronically."

"Jurisdictions around the world, including the US, are trying to figure out ways to tax online services," a Netflix representative told the Verge. "This is one approach."