Md. Digital Tax Ruling Is a Road Map for Future Challenges

State and Local Tax attorneys Sam Megally, Kyle Wingfield and Alejandra Enriquez wrote an article for Law360 about the Maryland Tax Court's three companion decisions invalidating the state's digital advertising tax. The court determined the first-in-the-nation levy on digital advertising revenue violates federal law and multiple provisions of the U.S. Constitution; it concluded that digital advertising services are similar to traditional advertising under the Internet Tax Freedom Act, making the measure a prohibited discriminatory tax on electronic commerce. In the articles, the authors break down the court's analysis and discuss the implications of the ruling for similar efforts in other states to extract income from digital platforms.

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