IT Tax Passes In MD -- NEW 6% Sales Tax

We Did Not Speak LOUD Enough—Computer Services Are Now to be Taxed at 6%

The Tech Council of Maryland (TCM) strongly opposes the 6% sales tax on computer services that passed during the 2007 special session of the Maryland General Assembly and has made the repeal of this tax a top priority.

In a statement, the organization said that it was “extremely disappointed” that the new tax was passed behind closed doors “with virtually no opportunity for public comment usually afforded to policy changes of this magnitude.”

“Taxing computer services stifles the growth of Maryland’s knowledge-led economy, inhibits new tech business growth and encourages the flight of tech businesses to neighboring states,” said TCM CEO Julie Coons.

The statement went on to point out that no other state, except for Connecticut, institutes a tax on computer services. Connecticut’s tax on computer services is 1%, while Maryland’s tax, effective July 1, 2008, will be 6%.

The tax, which extends to services like computer facilities management, custom computer programming, computer system planning, software and communication technologies, computer disaster recovery, hardware or software installation and computer maintenance and repair, will join 12 other services that are currently taxed in Maryland.  For an excellent summary and more information click here.