February 27, 2020
Dear Maryland Legislator,
On behalf of the undersigned organizations and businesses, representing a diverse coalition of nonprofit organizations and Maryland small businesses, we write to express our serious concerns regarding Senate Bill 2 and House Bill 0695, the “Digital Advertising Gross Revenues-Taxation'' bills. If adopted, this tax would significantly impact digital advertising within the state of Maryland, hurting our ability to sustain and grow our businesses.
Senate Bill 2 and House Bill 0695 would create a new tax on digital advertising revenues of companies with more than $100 million in global revenue. The tax could reach as high as 10 percent of revenues. The bills violate the Permanent Internet Tax Freedom Act and are constitutionally suspect.
Even if the legal maladies could be solved, this onerous tax should not be adopted. These bills are crafted to tax large companies that host digital advertising, but their impact will not be felt simply by those firms. Instead, Maryland-based small businesses and nonprofit organizations, such as ours, will feel the pinch.
Any tax on digital advertising will be passed on to companies and organizations seeking out Maryland audiences online, like ours. That means higher prices for digital advertising to consumers in our state, leaving us to feel the real pain of the tax.
Digital advertising is essential. It empowers groups and businesses like ours to compete in a difficult marketplace. By advertising our stores, our products, our restaurants, and our missions, we can compete with large, global entities to create jobs for Marylanders and advance our missions improving the Old Line State.
We understand the importance of funding education in the state of Maryland, but imposing unconstitutional taxes on digital advertising should not be a solution. For the sake of our organizations and small businesses, we hope that you reject this poorly constructed proposal.
Sincerely,
National Taxpayers Union Maryland Chamber of Commerce 127 Creative 360 Your Business American Advertising Federation of Baltimore Americans for Tax Reform Antietam Broadband Baltimore Business Journal Bubble Social Media Marketing Care Net Pregnancy Center of Frederick Catherine Foundation Pregnancy Resource Center Commercial Insurance Managers, Inc Devaney & Associates Herrmann Advertising High Rock Studio | Hulu Landmark Digital Laura’s Eyes Photos Manning Media Inc Millennium Marketing Solutions New North Orange Element Pink Dog Digital RCI Custom REJ & Associates, Inc Saunders Tax and Accounting SMiles Media SysTech Networks, LLC The Alternative Board Total Tax Service TSL Karaoke Entertainment |