Earlier today, the Maryland Senate passed S.B. 787, Digital Advertising Gross Revenues Tax and Tobacco Tax – Alterations and Implementation, on third reading (46-0). As amended, S.B. 787 makes the following relevant changes to the digital advertising tax:

  1. Exempts advertisement services on digital interfaces owned or operated by or operated on behalf of a broadcast entity or news media entity;
  2. Prohibits taxpayers from directly passing on the cost of the digital advertising tax to a customer who purchases the digital advertising services by means of a separate fee, surcharge, or line-item;
  3. Delays the start of the digital advertising tax to January 1, 2022; and
  4. Designates the bill as an emergency measure, meaning that it will take effect when enacted, rather than 30 days after the legislative override of any Governor veto.

S.B. 787 is scheduled to be introduced in the House of Delegates on Monday, March 8, 2021.