The Senate Budget & Taxation Committee will hold a hearing on sales tax issues this afternoon. The hearing will focus on expansion of the sales tax to services and the taxing of Internet sales.
Maryland Chamber President/CEO Kathy Snyder, CCE, will testify during the hearing, urging committee members to avoid actions that would make Maryland less competitive for jobs and investment.
The Maryland Chamber has long opposed taxing professional services. We believe such taxes increase administrative complexity and the cost of compliance. In addition, taxing professional services often has a disproportionately negative impact on small businesses. While larger businesses can hire employees to perform the services in-house, smaller businesses often lack the scale to in-source such activities.
Snyder will also caution lawmakers about policies regarding the taxation of online sales. She will urge them to consider participation in the Streamlined Sales Tax Agreement, rather than adopting policies that attempt an end run around the constitutional requirement that a vendor have a physical presence in the state, as other states have tried. These types of laws produce little revenue, cost the states jobs and end up mired in court, as is the case in New York.