A proposed tax by the Maryland general assembly could impose a tax on digital advertisers that make $100 million annual on digital advertising.
The bill would require companies that make more than $100 million annually on digital advertising overall — Facebook and Google, for example — to pay taxes on revenue derived from ads that appear on the device of a user with an IP address in Maryland, or is “known or reasonably suspected to be using the device in the state,” per the text.
In talking with my friends at SC&H Group in Hunt Valley, MD, this tax would most likely be passed on to individual advertisers by the major publishers, however, it’s much too early on in the process to know exactly what would happen.
The bill would place a tax on banner ads, search engine ads and social media ads. It is a way for the state to raise funds to pay for the Kirwan Commission legislation.
What Should You Do Now?
For now, it’s much too early on the legislative process to know exactly what impact this bill would have on the publishing community and more importantly, individual advertisers within Maryland or that run in ads in Maryland.
It certainly seems like it’s only a matter of time before bills like these start popping up throughout the US and potentially increase the amount advertisers will need to budget in order to reach their audience online.
I’ll be keeping an eye and ear on this story and will update as it progresses.
