Establishes a tax on digital ads

S 4778 establishes a 7% tax on digital advertising revenue exceeding $100 million annually for companies operating in New York. It directly affects large digital ad platforms (like social media or search engines) that use personal data for targeted ads, requiring businesses with over $1 million in New York digital ad revenue to file annual tax returns. The tax applies to "annual gross revenues" from digital ads in the state, defined as income before expenses, and takes effect for 2026 tax years. This policy creates a new revenue source by taxing a specific digital business model, avoiding traditional sales tax loopholes.