With the passage of S.B. 73, effective October 1, 2026, Utah has enacted a new 2% sales‑based excise tax imposed on the sales price of certain digital transactions. The tax applies to amounts paid for access to digital images, digital audiovisual works, digital audio works, digital books, and gaming services. It covers subscriptions, single‑use access, and streaming, regardless of the delivery method.
The tax applies to a “covered entity,” defined as a commercial entity required to perform age verification because it publishes or distributes digital content deemed harmful to minors. Covered entities that are already registered to file Utah sales and use tax returns must report and remit this excise tax electronically on the same filing schedule as their sales tax returns.
Revenue from the excise tax is dedicated to funding mental health programs for minors and enforcement of age‑verification requirements. While not a sales tax technically, the tax mirrors sales tax mechanics and adds compliance complexity for digital sellers—particularly those with multistate operations and subscription‑based revenue models—already subject to Utah sales and use tax obligations. (S.B. 73, Utah Legislature, effective October 1, 2026)