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Chip, Chip, Chipping Away at MD's Computer Tax

This summer, Maryland plans to start taxing computer services, raising the cost of these services by 6%.  Adjoining states like Virginia and Pennsylvania are the likely winners here, as companies will surely shift their computer outsourcing contracts to facilities outside of Maryland to avoid this new tax. 

We decided to help drive attention to this by talking about the economic development advantage that Virginia would likely gain over its arch-rival, Maryland.  We placed a letter to the editor in both the Baltimore Business Journal and Baltimore Sun.  That letter was then read at a 400-person rally held by a coalition called "Fight the Tax"   to get the crowd fired up for their visits to legislative offices.  It’s also featured on their website (

Here’s the letter:

As a former director of Virginia’s Economic Development Partnership, I know firsthand the competition between Virginia and Maryland in attracting new jobs and investment by high-tech and biotech companies. This proposed tax on computer services in Maryland makes it that much easier for Northern Virginia to compete with Maryland for any business that relies heavily on computer services, including financial services, health care and government contracting.

Maryland businesses are just beginning to realize the trouble this tax will cause when it goes into effect this summer. They’re also troubled by how this tax was enacted — via a conference committee at the 11th hour as a stop-gap measure to plug a budget gap.

But over here in Virginia, we’re not troubled at all. In fact, let me extend my thanks to Maryland for giving a new advantage to the Old Dominion.

There are now three bills in Annapolis aimed at repealing this misguided tax.  And we plan to keep the pressure on.

— Steve DelBianco