It is the right of States in the US to collect different types of taxes from the businesses that operate within their borders. Each state differs on the types of taxes they collect and the amounts of those taxes. Before you decide to locate a business in Maryland, you should review what business law in Maryland specifies as the taxes that the state can collect from a business.
Sales and Use Tax
One common type of tax is the sales and use tax. This type of tax is collected from any business that sells products to their customers, according to business law in Maryland. As such, any business that plants to make sales much acquire a sales and use tax license. This is accomplished by filling out a Combined Registration Application, a one-stop method for acquiring a variety of tax licenses.
In Maryland, the sales and use tax rate is 6 percent, except for on specific vehicle rentals or sales of mobile homes. Additionally, grocery and market business are not subject to sales tax. There are a few other exceptions as well, such as medicine, manufacturing machinery, and certain types of agricultural equipment.
Admissions and Amusement Tax
The admissions and amusement tax is another type of tax that some Maryland businesses are required to be licensed for. This tax is based on the gross receipts from admissions, recreational rentals, sports equipment, and the sale of items, drinks or services at a nightclub or other entertainment venue. Local officials in the area of the business' operation set the actual amount of this tax, which can range from 1 to 10 percent.
Corporation Tax
Another type of tax collected according to business law in Maryland is corporation tax. This tax applies to any corporation registered in Maryland, as well as any corporation that does a significant amount of business in the state. This tax is currently set at 8.25 percent. If a company operates outside of Maryland as well, they must carefully monitor their Maryland modified income to ensure the correct tax amount is paid. For certain corporations, business tax credits can be claimed, which will reduce overall tax liability in Maryland.
Personal Property Tax
Business law in Maryland also declares that a tax is collected on personal property owned by a business. Things like furniture, industrial equipment, supplies, tools and inventory are taxable under this regulation, though some businesses may be allowed to claim exemptions.
