Maryland To Become First State To Tax Online Ads Sold By Facebook and Google.

schwit1 writes: With a pair of votes, Maryland can now claim to be a pioneer: it's the first place in the country that will impose a tax on the sale of online ads. The House of Delegates and Senate both voted this week to override Gov. Larry Hogan's veto of a bill passed last year to levy a tax on online ads. The tax will apply to the revenue companies like Facebook and Google make from selling digital ads, and will range from 2.5% to 10% per ad, depending on the value of the company selling the ad. (The tax would only apply to companies making more than $100 million a year.) Proponents say the new tax is simply a reflection of where the economy has gone, and an attempt to have Maryland's tax code catch up to it. The tax is expected to draw in an estimated $250 million a year to help fund an ambitious decade-long overhaul of public education in the state that's expected to cost $4 billion a year in new spending by 2030. (Hogan also vetoed that bill, and the Democrat-led General Assembly also overrode him this week.) Still, there remains the possibility of lawsuits to stop the tax from taking effect; Maryland Attorney General Brian Frosh warned last year that "there is some risk" that a court could strike down some provisions of the bill over constitutional concerns.

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