Summary: Effective Aug. 1, 2026, Kentucky will apply sales tax to data brokering services under a broad new definition that may affect more businesses than expected. Companies should evaluate whether the law changes their sales tax collection, remittance, or compliance obligations as additional guidance becomes available.

Kentucky continues its recent trend of expanding the sales tax base to include additional services. Effective Aug. 1, 2026, data brokering services will become subject to Kentucky sales and use tax. While guidance from the Kentucky Department of Revenue remains limited, businesses providing or purchasing these services should evaluate whether the new law affects their operations and tax collection responsibilities.

Data brokering services are defined as “the act of collecting, aggregating, and analyzing personal data for sale to a third party while possession of the personal data is maintained by the person providing the data brokering services or by the third party.” Sales tax applies regardless of how the charges are billed.

Given the broad statutory definition and the limited guidance currently available from the Kentucky Department of Revenue, additional clarification is expected. KSM’s tax professionals are monitoring these developments and can help businesses evaluate the impact of the new law and prepare for compliance.

For guidance, reach out to your KSM advisor or fill out the form below.

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