Maryland Practice and Procedure

Maryland writes taxes other states then copy, and the digital advertising gross revenues tax is the current example: first of its kind in the nation, litigated in three forums at once, and a template for the bills other legislatures keep introducing. What happens to it under the Internet Tax Freedom Act and the Commerce Clause will shape how states tax the digital economy everywhere. This hub collects the questions that recur while that fight runs.

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Income and franchise procedure

What is Maryland's digital advertising tax, and why is it still being fought over?Maryland taxes the gross revenues that large companies earn from digital advertising shown to users in the state, and more than five years after the General Assembly overrode a veto to enact it, the tax is still being contested. The levy reaches a company only when its Maryland digital advertising revenue reaches $1 million and its worldwide gross revenue reaches $100 million, and it then applies a rate of 2.5 to 10 percent chosen by the size of the company's global revenue rather than by anything it does in Maryland. A companion provision barred companies from passing the tax to their customers as a separate fee, surcharge, or line item; the federal courts have held that ban unconstitutional under the First Amendment. The tax itself survived its first state court challenge only on procedural grounds, and in August 2026 the Maryland Tax Court held it invalid under the federal Internet Tax Freedom Act, the dormant Commerce Clause, and the Due Process Clause, ordering refunds with interest to three taxpayers for 2022. Those decisions are subject to further judicial review, the statute remains on the books, and other states continue to study the model. For companies in scope, the live questions are filing posture, preserving refund rights, and contract language.