Chicago Reaps Revenue Bonanza With Cloud Computing Tax

The city of Chicago has figured out an innovative—and lucrative—way to tax the cloud.

Chicago four years ago implemented a one-of-a-kind strategy to tax businesses for their use of remote computing services, like information from an out-of-state provider stored on the internet, or cloud, instead of on a computer hard drive. Under the program, known as the Personal Property Lease Transaction Tax,tax collections on cloud computing contracts have been ramping up at an impressive clip, according to data obtained by Bloomberg Tax from a Freedom of Information Act request.

Chicago reported collections of $13.9 million during the first six ...