Over the years, the "ordinary and necessary" deduction for advertising costs has been viewed as a potential revenue option to pay for new federal programs. NAA has been working to maintain the current tax treatment of advertising costs.

Here is why the deduction should be preserved:

• Advertising stimulates a large amount of sales and jobs in the U. S. economy. This, in turn, triggers a cascade of economic activity that would not have occurred otherwise. In fact, every dollar of ad spending generates just under $20 of economic output resulting in $5.8 trillion of the $29.6 trillion in U. S. output, according to a study conducted by IHS Global Insight, "The Economic Impact of Advertising Expenditures in the United States."
• By providing information in a cost effective manner, advertising helps the economy to function smoothly—it lowers prices and aids new products and even firms to enter the marketplace.
• Advertising is an cost of doing business similar to employee wages, utility costs, rents, and office supplies. The U. S. Tax Code has permitted all of these expenses, including advertising, to be deducted in the year they are incurred.
• If an advertising cost cannot be deducted, it becomes a tax on advertising, and advertising would become more expensive. This would harm newspapers and other media companies that rely on advertising in support of journalism. In the case of newspapers, circulation prices do not cover the cost of production let alone the editorial cost.
• Advertising is speech that is protected by the First Amendment. For nearly four decades, decisions by the United States Supreme Court have protected advertising under the First Amendment. While there is a line of reasoning that says deductions from taxes are provided at the discretion of Congress, the Supreme Court has said that taxes may not be applied in a manner that discriminates against speech.