Small Businesses Advocate in Washington Against Digital Ad Cost Hikes

A coalition of small businesses and entrepreneurs from across the United States gathered in Washington, D.C., on May 12 and 13, 2026, to voice their concerns about rising costs associated with digital advertising. Organized by Internet for Growth, the event marked the coalition's fourth annual fly-in during National Small Business Month, providing small business owners, creators, and digital professionals with an opportunity to advocate for policies that would support their online operations.

Costs of Operating Online Under Scrutiny

The coalition emphasized that decisions being made at both federal and state levels regarding privacy legislation, advertising taxes, and artificial intelligence (AI) are already impacting the cost of doing business online. These increasing costs, they argue, are ultimately passed along to consumers and could hinder the growth of small businesses.

Among the key legislative developments discussed during the event was the SECURE Data Act (H.R. 8413), introduced by Representative Joyce of Pennsylvania on April 21, 2026. The bill proposes a national privacy framework that would replace multiple state privacy laws with a single federal standard. While Internet for Growth expressed conditional support for the bill, it raised concerns about provisions that would allow users to opt out of targeted advertising, potentially shrinking the audience small businesses can reach through digital campaigns.

State-level initiatives have also drawn scrutiny. In Washington State, a 6.5 percent sales tax on digital advertising services - effective since October 1, 2025 - has been pointed to as a model other states may adopt. Local rates can push the total tax rate as high as 10.6 percent in some areas. Internet for Growth warns that such measures could further increase the cost burden on small businesses that rely on digital channels to market their products and services.

Small Businesses Speak Out

The event featured testimonies from small business owners who detailed how digital tools have transformed their operations. Ben Wolfgram, co-founder of Wisconsin-based glassware company BenShot, highlighted the pivotal role of digital advertising in his company's growth.

"Digital tools are how we built our business from the ground up", said Wolfgram. "What started as a father-and-son project grew into a nationwide business because we can reach interested customers online in affordable and effective ways. We support reasonable privacy protections, but some proposals would make it harder for businesses to use ordinary advertising data to reach people interested in their products."

Mike Samet, CEO of the digital marketing agency Digital Ignite, echoed those sentiments, emphasizing the role advertising plays in helping small businesses compete.

"As a digital marketing agency, we see firsthand how digital advertising and data-driven tools help small businesses reach customers, grow efficiently, and compete in today's online economy", said Samet. "There's an entire ecosystem of firms like ours helping businesses navigate digital marketing, e-commerce, social media, and customer outreach. These tools create opportunities that simply didn't exist for small businesses a generation ago."

Brendan Thomas, Executive Director of Internet for Growth, noted that any policy changes affecting larger platforms would likely have downstream impacts on small businesses.

"Small businesses support reasonable privacy protections and clear rules of the road online", said Thomas. "But policymakers should also recognize how interconnected digital advertising, media, marketing, and e-commerce have become in today's economy. Even when small businesses are exempt from certain requirements, higher costs and restrictions placed elsewhere in the system may be passed down through the platforms, services, and tools they rely on to reach customers and grow."

Legislative and Economic Context

The fly-in coincided with congressional deliberations over privacy legislation as well as emerging debates surrounding the role of artificial intelligence in advertising. Participants met with lawmakers and staff from both parties, including Senators Chris Coons, Cory Booker, Tammy Baldwin, and Lindsey Graham, and Representatives Sarah McBride, Jim Clyburn, and Frank Pallone. These meetings focused on the structural changes that could ripple through the digital economy, valued at $4.9 trillion and supporting 28.4 million jobs across all 435 congressional districts.

Beyond privacy regulations and state tax policies, coalition members also highlighted the opportunities AI presents for small businesses. They argued that AI tools embedded in digital marketing platforms allow businesses to save time, optimize advertising performance, and better understand customer needs. However, they cautioned that poorly designed regulations could limit access to these technologies, effectively pricing smaller businesses out of the AI-enabled advertising ecosystem.

Public Opinion and Data-Backed Advocacy

Internet for Growth brought data to strengthen its case. A national voter poll conducted in September 2025 showed that 94 percent of voters believe digital tools are essential for small business survival, while 78 percent opposed new taxes and regulations on digital advertising. The coalition also surveyed over 2,400 small businesses, with respondents reporting that digital advertising had fueled 39 percent growth over two years and that 82 percent found it an efficient way to reach customers.

The bipartisan nature of public opposition to additional regulations was also highlighted. According to earlier coverage, voters who supported both Donald Trump and Kamala Harris expressed nearly identical levels of opposition to added advertising restrictions, indicating that such issues resonate across party lines.

A Critical Moment for Small Businesses

For the small business owners and entrepreneurs who participated in this year’s fly-in, the stakes are high. They argue that the decisions being made today - not only in Congress but also in state legislatures - will determine whether small businesses can continue to thrive in the digital age. With privacy laws, advertising taxes, and AI policies all on the table, the coalition is urging policymakers to consider the cascading effects their decisions will have on the broader economy.

As Brendan Thomas summarized, "When digital advertising costs rise or become less effective, the impact moves quickly into consumer prices, hiring decisions, and local economic growth."

The outcome of these legislative debates will likely shape the ability of small businesses to compete, grow, and contribute to their communities in the years to come.

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