Maryland has enacted the nation’s first tax targeting digital advertising, as the House on February 11 and the Senate on February 12 overrode Governor Larry Hogan’s (R) veto of 2020 H.B. 732.
Maryland’s new tax applies to annual gross revenue derived from digital advertising in the state and is imposed at scaled rates between 2.5% and 10% (beginning with taxpayers that have at least $100 million of global annual gross revenue). Further, a return is only required from a person that has annual gross revenue derived from digital advertising services in Maryland of at least $1 million. As noted below, questions of interpretation arise under the new law.
