Maryland is going to start taxing ad revenue from tech companies like Facebook and Google
Tax money brought in will go to schools.
Tech companies like Facebook, Google, and Amazon basically print money and one of the ways these powerhouses are able to that is by selling ad space on their websites. Now, Maryland has passed legislation that will give it a piece of the cut. This makes it the first state to tax social media ad revenue.
The bill has not been easy, however. Those for and against the new legislation have made good points, with Governor Larry Hogan vetoing the bill last year.
Even with the struggles, it has now passed and estimated to generate $250 million during the first year. Once everything is in place, the money being brought in will be pumped back into schools in Maryland. Ads that will be taxed are only those displayed in Maryland.
It is not expected to be easy going forward either, with The New York Times reporting that “it is likely to set off a fierce legal fight over how far communities can go to tax the tech companies.”
People are also worried that tech giants will just pass off the taxed revenue by upping the prices it charges businesses to advertise. To counteract that, Senate President Bill Ferguson is reportedly passing emergency legislation that would restrict companies like Amazon, Facebook, and Google from passing the increased costs to those using the services.
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