Alabama can't seem to decide whether it wants to discourage porn consumption or profit from it. Starting in September, it will levy a 10 percent tax on adult website proceeds from any porn produced or sold in the state.
Adult websites are reportedly being told to create their "Material Harmful to Minors tax accounts" now.
How the Porn Tax Works
The tax was enacted as part of a larger anti-porn effort known as House Bill 164. "Pornography is creating a public health crisis," the measure's findings section claimed.
Alabama isn't exactly a porn industry hub, so the tax might seem at first glance like more of a P.R. effort than anything else.
But the way the law is written, it could have far-reaching implications. The tax applies to all "adult websites," which the legislation defines as digital platforms where more than a third of the content counts as "sexual material harmful to minors." (That's the convoluted term the state uses to describe content that "depicts or describes sexual conduct" or features "breast nudity or genital nudity" in a way that "lacks serious literary, artistic, political or scientific value for minors.")
"In addition to all other taxes of every kind, there is levied and shall be collected a tax at the rate of 10 percent upon the gross receipts of any commercial entity operating an adult website for all sales, distributions, memberships, subscriptions, performances, and all other content amounting to material harmful to minors that is produced, sold, filmed, generated, or otherwise based in this state," the law says.
So a website like OnlyFans would seem to owe the state of Alabama 10 percent of any money it makes off Alabama-based content creators, as well as 10 percent of any money paid by Alabama customers.
The same goes for webcam platforms, individuals selling adult content on their own websites, and so on.
And obviously, subscription-based porn platforms would owe money on any subscriptions paid by Alabama residents.
It's unclear what the tax will mean for porn sites that make most of their money from s rather than subscriptions. Are they expected to calculate exactly how much ad money is generated by views in Alabama?
It's also unclear how adult websites might react to this tax. Will it mean higher prices for Alabama-based subscriptions? Higher cuts taken from creators in the state?
In any event, the whole thing seems like a compliance nightmare for platforms and for independent producers and performers.
And while it's technically aimed at porn sites, it certainly seems capable of harming erotic content creators even if they don't sell on their own websites. If porn platforms can't easily pass on the tax to them in some way, they could downgrade their content or even block them entirely.
Taking away a relatively safe means of doing sex work for Alabama residents seems unlikely to make performers safer or better off. Many will move to more dangerous forms of sexual labor.
Alabama Is Eager to Start Enforcement
The state's Department of Revenue has started contacting adult websites about the tax, reports XBIZ:
One such notice, which XBIZ has seen, includes the following information:
In accordance with Act 2024-97, effective September 1, 2025, there is a tax of 10 percent levied on the gross receipts of any commercial entity operating an adult website. The tax is due on the gross receipts of all sales, distributions, memberships, subscriptions, performances and all other content amounting to material harmful to minors that is produced, sold, filmed, generated, or otherwise based in this state.
The entity should register for a Material Harmful to Minors (MHM) tax account through My Alabama Taxes. The tax on these gross receipts will be reported and remitted in the same manner as the sales and use taxes beginning with the September 2025 filing period due in October 2025….
The adult site that shared the notice told XBIZ that it had received the letter despite the fact that it is not based in Alabama and has been blocking access there since October. According to the ALDOR rep, that is normal.
"The duty of the Alabama Department of Revenue is to make those entities that may be subject to the tax aware of the new tax levy," the rep explained. "If an entity receives a notice, that does not mean that the department has determined that the entity is subject to the new tax."
A Broader Anti-Porn Package
H.B. 164, which passed last year, imposes much more than a porn tax. Most of the attention around it has focused on a requirement that websites verify the ages of people trying to watch porn from within Alabama.
Failing to verify user ages is "considered a violation of the Deceptive Trade Practices Act," according to the law, and individuals can sue websites that fail to do so.
The age verification measure took effect last October, prompting some adult sites—such as Pornhub—to block access for Alabama residents.
H.B. 164 also requires adult websites to display a warning label that is absolutely steeped in pseudoscience, even though a similar requirement in Texas was found unconstitutional two years ago.
The warning label must include several unproven and in some cases false statements, including that pornography may be "biologically addictive," that it "is proven to harm human brain development," that it "weakens brain function," that it "is associated with low self-esteem and body image, eating disorders, impaired brain development, and other emotional and mental illnesses," and that it "increases the demand for prostitution, child exploitation, and child pornography."
Is the Porn Tax Constitutional?
The porn tax portion of H.B. 164 is slated to take effect on September 1.
"Before the ruling in FSC v. Paxton, I would have said that the Alabama law is a clear example of selectively taxing adult companies because of their content, and that even a conservative court would strike it down as unconstitutional," Alison Boden, executive director of the Free Speech Coalition, told XBIZ. "In a post-Paxton world where the meaning of the First Amendment is seemingly up for grabs, it's unclear." (In Paxton, decided earlier this summer, the U.S. Supreme Court said that states may demand that porn sites verify users' ages.
On one level, "sin taxes" of this sort are nothing new—governments love to levy special taxes on products they want to discourage, as we've seen with cigarettes, alcohol, marijuana, and so on. But pornography is a form of legal speech, and that renders sin taxes on porn something a little different.
Attorney Lawrence Walters told XBIZ the tax "may constitute an unconstitutional content-based burden on speech," but he also pointed out that so far, nothing is preventing its enforcement.
More Sex & Tech News
Cop who fabricated sex trafficking case can't be sued: "A police officer who had a woman jailed for over two years on false charges in connection with a bogus sex-trafficking ring cannot be sued, a court confirmed last week, because she was acting under color of federal law—a puzzling reminder of the inverse relationship between power and accountability in government," Reason's Billy Binion explains.
Online Safety Act wreaking havoc: Reason intern Tosin Akintola looks at some of the many ways the Untied Kingdom's Online Safety Act is starting to reshape the internet. X has begun restricting content related to Gaza for its U.K. users, and Reddit has implemented age-verification measures to view posts about cigars," among other things.
Sex toy surveillance: "Lovense, a maker of internet-connected sex toys, has confirmed it has fixed a pair of security vulnerabilities that exposed users' private email addresses and allowed attackers to remotely take over any user's account," reports TechCrunch.
Shame sells: "Two tech bros have come up with an app to save young men" from porn, reports The Free Press. Their big idea? Turning on your phone's front camera when you're feeling temptation. "The big thing is shame, like, look at how stupid you look," co-founder Connor McLaren said. Other ideas: "calling porn 'gay,' referring to viewers as 'losers.'" As Mike Stabile points out on Bluesky, anti-porn action is almost always "just warmed over anti-masturbation rhetoric. These guys are never 'oh, just use your imagination, my dude,' it's 'suppress sexual desire.'"
Abortion pill reversal: Colorado can't ban medical professionals from talking about so-called "abortion pill reversal," a federal court says.
Bored Ape NFT lawsuit: "Does anyone still care about NFTs?" asks law professor Eric Goldman, prompted by a decision in a lawsuit concerning Bored Ape artwork and trademark law.
Age verification in Australia: Austrailia's "new Online Safety Amendment (Social Media Minimum Age) Bill has galloped through Parliament like a runaway Shetland pony, banning under-16s from social media," writes Nicole James at The Freeman. "This is a full-blown digital eviction. And the ban isn't limited just to TikTok and Snapchat. It also extends to YouTube (yes, YouTube), where apparently autoplay is now considered a gateway drug."
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