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O'Malley Proposal Not a New 'Tech Tax'
January 25, 2012
The Daily Record
Cynthia Blake Sanders was interviewed by The Daily Record in a piece on Governor Martin O'Malley's proposal to apply the Maryland state sales tax to sales made into the state by major online retailers. Here is an excerpt:
Gov. Martin O'Malley is considering revisions to his effort to expand Maryland's sales tax on the Internet after the proposal angered business groups, tech firms and others that deal digital goods and services, an aide said Wednesday.
The governor called for the General Assembly to raise an estimated $21 million by applying the state sales tax to sales made into the state by major online retailers such as Amazon.com. He also proposed taxing "digital goods," such as downloaded songs, movies and books, a measure the administration said could raise about $5 million.
But the "digital goods" definition was left vague and open-ended, prompting fears that it could be interpreted to include software and consulting, accounting, advertising and other services exchanged via the Internet.
Cynthia Blake Sanders, an Ober|Kaler attorney who heads the legislative committee of the American Advertising Federation of Baltimore, said the proposal could apply to business-to-business transactions.
A video sent from a production company to an advertising firm could have fallen under the definition, she said.
"What's happening is, you're basically adding 6 percent for the cost of advertising," she said.
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