Maryland expands its sales and use tax base to include certain IT services starting on July 1, 2025.

Maryland expands its sales and use tax base to include certain IT services starting on July 1, 2025. This comes after the signing of House Bill 352 on May 20, 2025 by Maryland’s governor. The bill now subjects system software and application software publishing services, computing infrastructure providers, and also data processing, web hosting and associated services to a 3% sales tax. The expansion could affect software and SaaS exemptions currently in place. The 3% will only be applied if the 6% rate is inapplicable.

Read the full update here: https://www.marylandcomptroller.gov/content/dam/mdcomp/tax/legal-publications/technical-bulletins/tb-56.pdf