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US Maryland reimposes digital services sales tax

Digital services and advertising services subject to 6% sales tax

The US state of Maryland confirmed the 6% sales tax levy on a range of digital services, including:

  • Streaming films and music,
  • ring tones,
  • e-books and audio books,
  • online newspapers and
  • cable, satellite and pay-per-view television programming.

Most US states with a sales tax – around 40 – also impose their indirect tax on digital services, too.

Advertising services

A new 2021 law has now been enforced to impose sales tax on the annual gross revenues on a certain digital advertising services. Generally, only providers with revenues above $1million in Maryland will be liable.

The legislation had been blocked by the state governor; but the legislature has now overruled.

US Sales Tax rates and selling thresholds

State State sales tax rate Remote seller annual thresholds Digital services taxable?
$ threshold Transactions threshold
Alabama 4.0% 1 Oct 2018 $250,000 Yes
Alaska 0% - n/a No state-wide tax
Arizona 5.6% 1 Oct 2019 $100,000 - Yes
Arkansas 6.5% 1 July 2019 $100,000 200 transactions Yes
California 6.0% 1 April 2019 $500,000 - No
Colorado 2.9% 1 Dec 2018 $100,000 - Yes
Connecticut 6.35% 1 Dec 2018 $100,000 200 transactions Yes
Delaware 0.0% - n/a No state sales tax
Florida 6.0% 1 July 2021 $100,000 - No Communications Tax. E-books exempt
Georgia 4.0% 1 Jan 2019 $100,000 200 transactions No
Hawaii 4.0% 1 July 2018 $100,000 200 transactions Yes General Excise Tax
Idaho 6.0% 1 June 2019 $100,000 Yes Software exempt
Illinois 6.25% 1 Oct 2018 $100,000 200 transactions No
Indiana 7.0% 1 Oct 2018 $100,000 200 transactions Yes
Iowa 6.0% 1 Jan 2019 $100,000 - Yes
Kansas 6.5% 1 July 2021 $100,000 - No
Kentucky 6.0% 1 Oct 2018 $100,000 200 transactions Yes
Louisiana 4.45% 1 July 2020 $100,000 200 transactions Yes
Maine 5.5% 1 July 2018 $100,000 - (since 2022) Yes
Maryland 6.0% 1 Oct 2018 $100,000 200 transactions Yes
Massachusetts 5.6% 1 Oct 2018 $100,000 No
Michigan 6.0% 30 Sep 2018 $100,000 200 transactions No
Minnesota 6.875% 1 Oct 2018 $100,000 200 transactions Yes
Mississippi 7.0% 1 Sep 2018 $250,000 - Yes
Missouri 4.225% 1 Jan 2023 $100,000 - No
Montana 0.0% - n/a No state sales tax
Nebraska 5.5% 1 April 2019 $100,000 200 transactions Yes
Nevada 4.6% 1 Oct 2018 $100,000 200 transactions No
New Hampshire 0.0% - n/a
New Jersey 6.625% 1 Nov 2018 $100,000 200 transactions Yes
New Mexico 5.0% 1 July 2019 $100,000 - Yes
New York 4.0% 21 July 2018 $500,000 100 transactions No
North Carolina 4.75% 1 Nov 2018 $100,000 200 transactions Yes
North Dakota 5.0% 1 Oct 2018 $100,000 - No
Ohio 5.75% 1 Aug 2019 $100,000 200 transactions Yes
Oklahoma 4.5% 1 Nov 2019 $100,000 - No
Oregon 0.0% - n/a No state sales tax
Pennsylvania 6.0% 1 July 2019 $100,000 Yes
Puerto Rico 10.5% 1 Jan 2021 $100,000 200 transactions Yes
Rhode Island 7.0% 1 July 2019 $100,000 200 transactions Yes
South Carolina 6.0% 1 Nov 2018 $100,000 - No
South Dakota 4.5% 1 Nov 2018 $100,000 200 transactions Yes
Tennessee 7.0% 1 July 2019 $100,000 - Yes
Texas 6.25% 1 Oct 2019 $500,000 - Yes Only if physcial equivilaent is taxable (e.g. books)
Utah 4.7% 1 Jan 2019 $100,000 200 transactions Yes
Vermont 6.0% 1 July 2018 $100,000 200 transactions Yes
Virginia 4.3% 1 July 2019 $100,000 200 transactions No
Washington 6.5% 1 Oct 2018 $100,000 - Yes
Washington, DC 6.0% 1 Jan 2019 $100,000 200 transactions Yes
West Virginia 6.0% 1 Jan 2019 $100,000 200 transactions Yes Streaming services only
Wisconsin 5.0% 1 Oct 2018 $100,000 - (since 2021) Yes
Wyoming 4.0% 1 Feb 2019 $100,000 200 transactions Yes

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