as agencies, broadcasters, newspaper publishers and big advertisers prepare to push back, there is concern that such moves could not only pass, but spread to other states and to the federal level.

If Ohio's legislature approves Republican Gov. John Kasich's proposed budget, sales of print, billboard, radio and TV advertising would be subject to a 5% sales tax.  Further, the tax would likely apply to the fees agencies charge clients.  Mr. Kasich wants to expand Ohio's sales tax so he can raise enough revenue to cut other taxes, including personal income and business taxes. The Ohio budget doesn't require approval until July 1, so opponents of the tax have time to kill it -- something that's happened in the past when such proposals were floated.

Dan Jaffe, exec VP-government relations for the Association of National Advertisers, said taxing advertising is counterproductive.

"The whole purpose of advertising is to generate sales," Mr. Jaffe said.  "So if you're becoming more reliant on sales taxes, you shouldn't be doing anything to stop an effort to sell."

Few states have taxed advertising, and none have done so successfully.  Florida tried it in 1987, but national advertisers canceled conventions in the state.  Advertising was also canceled. Broadcasters alone saw $93 million in ad sales wiped out.  Facing an uproar, Florida repealed the tax. Roger Keys, President of Marketing Keys, started his career in advertising in Florida right after the tax was repealed. "It was one of the dumbest ideas back then for a state to raise money," Keys said. "And it remains a dumb idea today." 

But states aren't the only issue.

"If something of this magnitude is taking place in the states, they certainly would be aware of it in Washington," Mr. Jaffe said. "We're keeping ourselves on high alert."