Streaming Costs Increase in 2026 Due to New Taxes

Starting January 1, 2026, residents in Maine began noticing a new charge on their monthly bills for popular streaming services like Netflix, Hulu, Disney+, and more. This change comes as Maine has expanded its sales tax to include digital subscriptions, podcasts, audiobooks, and other online audio and video content that are delivered electronically on a subscription basis.

This update brings Maine in line with over 30 other states that already tax digital streaming services. Before this change, streaming platforms were exempt from the sales tax because they involved temporary electronic transfers rather than permanent downloads or physical products. Now, with this update, the state can capture revenue from shifting consumer habits and ensure fairness across different types of audiovisual and audio delivery methods.

The decision to implement this tax came as part of a $320 million supplemental budget package approved by the Maine Legislature and signed into law by Governor Janet Mills in June 2025. This budget addressed various funding needs, including investments in healthcare, nursing home reforms, mental health resources, and higher education. To support these priorities, the budget included several revenue-generating adjustments, such as the new streaming tax.

In addition to taxing digital subscriptions, the supplemental budget also repealed the 6% Service Provider Tax on cable and telecommunications services. This move shifted these services under the standard 5.5% general sales tax rate, reducing the burden on providers while ensuring consistency in taxation across industries. The legislation also modernized certain exemptions, refining the overall tax structure in Maine.

According to revenue projections, the streaming tax is expected to generate around $5 million in additional funds during fiscal year 2026, growing to $12.5 million annually in the near future and reaching $14.3 million by 2029. While this tax adds only a small amount to individual bills, it can accumulate for households with multiple streaming subscriptions.

These changes reflect a national trend of updating tax frameworks for the digital age. In Maine, these adjustments aim to address budget gaps, fund essential services, and adapt to changing economic patterns without introducing entirely new tax categories. As residents adjust to these updates, the long-term impact will rely on subscription trends and economic conditions in the state.