Maryland Supreme Court reverses ruling on digital ad tax

Marketwatch - Associated Press ^ | Tuesday, May 9, 2023 | Associated Press

[linMcHlp]

EXCERPTS

Last year, the [Maryland] circuit court ruled that the tax on digital advertising violates the federal Internet Tax Freedom Act, which prohibits discrimination against electronic commerce. The [Maryland circuit] court also held that the law violates the U.S. Constitution’s prohibition on state interference with interstate commerce.

“This court [Maryland Supreme Court] has repeatedly held that constitutional claims are to be presented to the tax court . . . [ever] since the establishment of the tax court," said Julia Bernhardt, an assistant Atty Gen.

Jeffrey Friedman, an attorney for the plaintiffs, argued there was a constitutional exception that applied to this case.

“It only applies, as this court [Maryland Supreme Court] has repeatedly described it, in a situation where the entirety of the law is invalid. In this case, [the law] is invalid because it violates federal law,” he told the court . . .

[Maryland] estimated the tax could raise about $250 million a year to help pay for a sweeping K-12 education measure.

The law taxes revenue that the affected companies make on digital advertisements shown in Maryland.

[linMcHlp]

The article title is a bit misleading. The Maryland Supreme Court is reversing a Maryland circuit court ruling, so the case is being sent back to a tax court.

October 17, 2022:

Maryland judge strikes down nation’s first digital ad tax

by Brian Witte

https://apnews.com/article/technology-business-maryland-constitutions-annapolis-5c61d7517cba52384eee6ac8a09c4cad

EXCERPT:

ANNAPOLIS, Md. (AP) — The nation’s first tax on digital advertising was struck down as unconstitutional by a Maryland judge on Monday. It’s a law that attorneys for Big Tech have contended unfairly targets companies like Facebook, Google and Amazon in a separate federal case against the same law.

That "separate federal case:"

February 18, 2022:

Digital ad tax argued in Maryland federal court case

by Brian Witte

https://apnews.com/article/technology-business-education-legislature-maryland-4cbed4b9ee4687919547bec3ba312648