Sales Tax on Services Under Consideration in Maryland

For those who haven’t followed Clayton Financial and Tax, we now have an office in Maryland. Our charges for preparing your return aren’t dependent on whether you’re in our Las Vegas or Bethesda office. However, that may soon change.

Shiela Hixson and James Gilchrist, two Democrats in the Maryland House of Delegates (the lower chamber of Maryland’s legislature) introduced legislation that would add sales tax to 29 different services. The services that would be taxed under this proposed legislation include tax preparation, gyms, cable television, consulting, and dating services.

If this tax passes, the added costs to our business will be passed on to our customers. And, yes, there are always added costs in compliance: The time we will have to spend complying with bureaucratic paperwork.

I haven’t been following Maryland’s budget situation, but I’m sure they (like every state) are facing some shortfalls. The typical Democratic response is to increase revenues, not decrease expenses. That may be one of the reasons “Blue” states find themselves with worse budget situations than “Red” states. However, I might just be too cynical.

[Image of Maryland’s state flag from Wikipedia]

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