The Entertainment Software Association has sued Chicago to stop enforcement of a tax on entertainment that would apply to subscription video game services like World of Warcraft and Minecraft.

ESA announced Monday that the city's decision in 2015 to expand its existing "amusement tax" to include streaming and subscription video game services was "illegal and harmful." The group filed a lawsuit in the Illinois Circuit Court of Cook County contending the reinterpretation of the tax violates the Internet Tax Freedom Act—a 1998 federal law preventing state and local governments from imposing internet-only taxes.

"This discriminatory tax makes Chicagoans' lives more expensive, just because they live in the 21st century and choose to play video games online," ESA CEO Michael Gallagher said. "As one of the most innovative and rapidly growing industries in Illinois, we are proud to take this fight to court and stand up for consumers."

Amusement taxes are special taxes collected from the sales of arts and entertainment services. Chicago's 9 percent tax has been in place for decades but historically applied to recreational activities such as access to amusement parks or athletic venues such as bowling alleys.

City officials now interpret the amusement tax to apply to video game services in which customers pay a monthly or yearly fee for access, the Chicago Tribune reported. Subscription gaming services such as Xbox Live are also are now taxed, as are music and video streaming such as Spotify and Netflix.

Chicago had been previously sued by the Liberty Justice Center, a division of conservative think tank Illinois Policy Institute. Attorneys for the center also argue the tax violated the Internet Tax Freedom Act. The case is pending in state court.

A spokesman for Chicago's Law Department told the Tribune that the city stand behinds its interpretation of the tax. http://trib.in/2r5WV2S

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