Sales Tax on Services shows up
It's here! The dreaded Sales Tax on Tax, Consulting, and Management Consulting services bill was filed as HB 1051 Sales & Use Tax Services. What was significant about this to us is that it was sponsored by the powerful Chair of the House Ways & Means Committee.
MACPA will be there to testify in opposition at the hearing on March 6th.
In addition there is another "tax on services" bill which was unexpected. The Governor's budget bill The Budget Reconciliation & Financing Act (BFRA) SB 152/HB 87 has a clause which not only affects Maryland's technology companies but could extend to other electronic services, like e-filing of tax returns and even our webcasts for educational purposes. Read pages 33 to 42 to read about the "digital download" language which is very expansive. Legislative staff have confirmed this broad and far-reaching language that goes well beyond the listed products of music, books, e-cards, and software. This is fast becoming the tech tax redux and is being called the "digital download" tax.
MACPA will be at the hearings on Feb 29 in the Senate Budget & Tax and on March 1st in the Appropriations Committee to testify in opposition to this clause.
In addition we have been asked to review lots of other tax proposals (thanks to our hard working State Tax Committee) and will be supporting the following bills in the next few weeks:
- HB 581 Income Tax - Expensing of Business Property & Bonus Depreciation (recoupling) filed by MACPA member & CPA, Del. Gail Bates et al
- HB 203 Maryland Death Taxes - Family Protection Act filed by Del Krebs et al
Both of these bills follow the "recoupling" of Maryland law to federal tax law reducing the costs of compliance by taxpayers.
Millionaire's Tax and Combined Reporting are also in the mix, you can read a well done recap at the Daily Record's "Eye on Annapolis
The Maryland Chamber of Commerce has a list of bill's that affect business here