Tech Council of Maryland Leads Call for Repeal of Computer Services Sales Tax

Hundreds of Tech Professionals Attend Rally, Crowd Hearing Rooms in Annapolis

ANNAPOLIS, Md.--(BUSINESS WIRE)--The Tech Council of Maryland, the state’s largest trade association representing the IT and Biotech industries, joined with the Maryland Chamber of Commerce and fellow members of the Fight the Tech Tax Coalition at a demonstration this morning on Lawyers Mall, outside of the Maryland State House, calling for repeal of the computer services sales tax.

“We understand that you, as the leading business people in Maryland want our legislators to know this is a bad, bad tax.”

“I want you to know that we understand your pain,” Tech Council CEO Julie Coons told the crowd to a round of applause. “We understand that you, as the leading business people in Maryland want our legislators to know this is a bad, bad tax.”

IT professionals from around the state waved signs and chanted “Axe the tax!” Some brought their entire office staff to Annapolis for the day, while others had their children in tow. During the rally, members of the Geek Squad were spotted circling the State House in their trademark Volkswagens. Non-IT companies, including a delegation from Geico Insurance, attended to make sure lawmakers understand that the tax affects all businesses in Maryland.

A bevy of speakers took to the podium to tell their stories. Anne Lipman, president and CEO of Altek Information Systems, said the tax sends a mixed message: “I don’t understand the state supporting my business through the MBE (Minority Business Enterprise) program and then taxing my business so heavily on the other end. It’s like the state gave me a helping hand to get started and now is hampering my growth to the point where I am worried about the survival of my business.”

Chuck Kramer, CTO of Social & Scientific Systems, offered a consumers perspective: “The six percent tax will cause our IT budget to rise significantly, which will impact new hires and new research.

“I ask every legislator today to understand that large companies, who have spend enormous resources to make Maryland a leading technology state in the nation, are a financial risk, too. It is not as easy as just paying the tax we get,” said Mr. Kramer.

“We will continue to meet with legislators in their offices, in the state house hallways or right here on Layers’ Mall to tell them the computer services sales tax won’t work for our industry,” said Ms. Coons.

After the rally, Ms. Coons offered testimony at hearings before the House Ways and Means Committee and the Senate Budget and Taxation Committee. She warned of the impact the levy would have on high-tech and high-paying jobs that have been the backbone of Maryland’s economic growth.

“Some businesses, especially those in computer services and those with government contracts, have profit margins of five to seven percent and cannot pass along their costs to their customers, This tax will have a devastating impact on them,” Ms. Coons testified. She noted that surrounding states, including Virginia, Delaware and Pennsylvania, have already stepped up their efforts to recruit businesses away from Maryland.

Ms. Coons encouraged the Senate to consider SB 1004, which would enact a temporary income tax surcharge as an alternative to the current six percent computer services sales tax, opening the door for its repeal.

ABOUT THE TECH COUNCIL OF MARYLAND

The Tech Council of Maryland (TCM) is the largest technology trade serving the advanced technology and biotechnology communities of Maryland. TCM’s mission is to advocate for the interests of the technology community, further the role of technology in the Maryland economy, and nurture an environment where technology companies can collaborate, grow and succeed. For more information, visit www.techcouncilmd.com.