Netflix subscriptions are going up again but only for Florida residents. Here's why

Brandon Girod, Pensacola News Journal
Updated ·3 min read

Editor's note: This story has been revised to change that dealers may not absorb Florida CST.

In an email to its customers, video streaming giant Netflix announced it would begin charging its Florida users an additional 7.44% sales state service tax starting on Feb. 15.

The additional charge, which is Florida’s communications services tax (CST), is applied to all types of services, such as toll phones, VoIP phones, video services, mobile communications and even telegrams.

The Florida CST is applied to all sales of communications services unless specifically exempt. For mobile communications and video services, the tax is 7.44%.

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Companies can choose to pass that tax onto their customers, which can be seen itemized on their bill, but they may not absorb or relieve the customer of all or any part of the Florida CST.

“We hope you’re enjoying everything Netflix has to offer. Starting on Feb. 15, 2024, additional state services tax will be applied to your monthly subscription. You can read more about how taxes affect your Netflix membership here,” the email said.

Netflix raised prices in November

The move comes just a few months after Netflix announced that it would be increasing the prices for its Basic and Premium subscription plans. The company’s Basic plan was increased to $11.99 per month, a $2 increase, while the Premium plan jumped to $22.99 per month, a $3 increase.

Netflix’s entry-level and Standard tier remained the same prices — $6.99 and $15.49 per month, respectively.

Netflix will soon retire its ad-free Basic plan in the U.S.

The Verge reported in late January that Netflix has plans to soon discontinue its cheapest ad-free plan, leaving a sizable gap between its ad-based $6.99 plan and the standard ad-free plan, which costs $15.49 per month.

Netflix announced plans to kill the plan starting in Canada and the U.K. in the second quarter of this year. No hard dates have been announced for the U.S. yet, but the streaming service prohibited new users from signing up for the Basic plan in the U.S. in July last year.

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What is the Florida communications services tax (CST)?

The Florida communications services tax is made up of two parts: The Florida communications services tax and the local communications services tax, according to the Florida Department of Revenue.

The Florida CST includes state tax and gross receipts taxes. The total rate for the CST is 7.44% (4.92% state tax rate + 2.52% gross receipts taxes (0.15% + 2.37%). The local portion of the tax varies by jurisdiction.

Examples of services subject to the tax include, but are not limited to:

  • Local, long-distance and toll telephone

  • Voice over Internet Protocol (VoIP) telephone

  • Video services (such as television programming)

  • Video streaming

  • Direct-to-home satellite

  • Mobile communications

  • Private line services

  • Pager and beeper

  • Telephone charges made at a hotel or motel

  • Facsimiles, when not provided in the course of professional or advertising service

  • Telex, telegram and teletype

This article originally appeared on Pensacola News Journal: Netflix subscriptions to go up 7.44% for Florida subscribers