A bill introduced to the Maryland House of Delegates this month would subject PR, direct mail advertising, cable TV and printing, among 25 other services, to the cash-strapped state’s sales tax.
Introduced by two Democrats on Feb. 10, the bill alters the definition of “taxable service” in Maryland to include 29 new disciplines, including “management consulting, a public relations, or any other business consulting service.”
Maryland’s sales tax is six percent.
The bill, if passed and signed into law, would go into effect Jan. 1, 2013.
“We oppose the bill and plan to voice our concerns at the hearing next week,” said Will Burns, communications director for the Maryland Chamber of Commerce. Asked about its prospects for advancing, Burns said, “When the state legislature is trying to deal with a budget situation, you never know what will happen.”
He added that taxing business-to-business and professional services is a particularly poor way of raising revenue and said a similar effort to expand sales taxes was scuttled in 2007.
One of the bill’s sponsors is Del. Sheila Ellis Hixson, who chairs the Maryland House’s influential Ways and Means Committee. The second sponsor, Jim Gilchrist, introduced a bill in 2007 to tax all creative services in the state.
The bill goes before the Ways and Means Committee on March 6.
Other services to be taxed under the measure include tax preparation, public lockers, dating/escort, tanning/massage, barber/beauty parlor, and pest extermination.
Read the bill (PDF).