Tax Commission Proposes Tax Change (Video)

When Maryland state legislators return in January, reforming the communications tax structure may be a top issue.

A new proposal to modify the state’s communications tax structure suggests it be modified to 4 percent. The current rate varies per industry including: 6 percent on the sales tax of wireless phones, 2 percent franchise tax on landline phones and currently there isn’t a tax on all cable and satellite television.

The projected losses on two previous proposals, presented in May, prompted the commission to introduce a new one on June 12. Local governments would have potentially lost between $136 million and $141 million, according to the proposals.

“It became clear when the numbers came back from the comptroller’s office, the revenue losses would have been too great. We didn’t think the two proposals were going to move forward and get support,” said Scott Mackey, a representative of KSE Partners.

His company assists governments in applying tax policy and wireless communications.

Mitsuko Herrera, the Montgomery County Cable Administrator, responded to the new proposal. She said there is still work to be done.

The Maryland Communications Tax Reform Commission is scheduled to submit its report by the end of June.

About Tamika Smith

Tamika Smith is passionate and curious about the world. She often wonders what motivates people to walk in their particular journeys in life. A native of Miami, Florida Smith graduated from Howard University in 2007 and continues to give back through mentorship.

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