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TCM News
For Immediate Release Contact:
Julie Coons
TCM
Chief Executive Officer
240-243-4080
Tech Council of Maryland Vows to Work for the Repeal of Computer Services Sales Tax
(Rockville, MD) November 28, 2007-The Tech Council of Maryland (TCM) strongly opposes the 6% sales tax on computer services that passed during the 2007 special session of the Maryland General Assembly and has made the repeal of this tax a top priority. TCM was extremely disappointed that this new tax was passed behind closed doors with virtually no opportunity for public comment usually afforded to policy changes of this magnitude. A tax on computer services makes Maryland’s business climate and tax structure less competitive with that of surrounding states and runs counter to the State’s economic development efforts to create a nationally recognized knowledge economy.
No other state but Connecticut institutes a tax on computer services and this measure has been under legal scrutiny since its inception. Perhaps most appalling for Maryland’s technology companies is that Connecticut’s tax on computer services is 1% while Maryland’s tax, effective July 1, 2008, will be a whopping 6%. Other states like Florida and Pennsylvania found that taxing computer services was unwieldy, confusing and difficult to administer. Both states repealed these taxes. In Florida, the tax was repealed only three months after it became effective.
“Taxing computer services stifles the growth of Maryland's knowledge-led economy, inhibits new tech business growth, and encourages the flight of tech businesses to neighboring states,” said Julie Coons, TCM’s Chief Executive Officer.
The tax, which extends to services like computer facilities management, custom computer programming, computer system planning, software and communication technologies, computer disaster recovery, hardware or software installation and computer maintenance and repair, will join 12 other services that are currently taxed in Maryland. The new tax on computer services was part of a massive tax bill (SB 3 – Tax Reform Act of 2007) designed to close Maryland’s FY2009 deficit and ongoing structural deficits.
“In the current budget crunch, Maryland legislators decided that the tech industry should take it on the chin. Maryland tech was provided no public opportunity to be heard on this outrageous measure,” said Coons.
As the only Tech Council in the state of Maryland with full-time government relations staff, TCM will continue to represent and provide a collective voice for its members’ views on the Computer Services Sales Tax issue. In the coming weeks, TCM staff will hold a town hall meeting and meet with Maryland legislators to express opposition to this tax.
For more information, or to lend a voice to this issue, please call Rick Harris, Executive Director, Tech Alliance, Tech Council of Maryland at 240-243-4070 or email him.
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The Tech Council of Maryland (TCM) is Maryland's largest technology trade association that brings its 500 plus members access to technology industry leaders in Maryland,DC and Virginia. TCM has two divisions, which provide valuable resources and benefits to help businesses succeed.The Tech Alliance serves the advanced technology community and MdBio serves the Maryland biotechnology community. TCM helps the region's technology organizations grow through its membership and activities such as networking events, cost saving programs, and advocacy initiatives. TCM is the preeminent technology professional association for you! Our mission is to promote the technology industry and to create an environment where technology companies can collaborate, grow and succeed.
The Tech Council of Maryland is supported in part by a grant from Maryland's Department of Business and Economic Development (DBED).