DIGITAL AD TAX ARGUED IN MARYLAND FEDERAL COURT CASE

Attorneys in a federal court challenge to Maryland’s first-in-the-nation digital ad tax argued about whether the law is a tax or an unconstitutional penalty targeting Big Tech.

- 

Attorneys for the state of Maryland and a lawyer representing Big Tech gave arguments in a virtual hearing before U.S. District Judge Lydia Kay Griggsby in a case that is being closely watched by other states that are also considering a tax for online ads.

Julia Bernhardt, a Maryland assistant attorney general, defended the law as a legitimate revenue-raising measure approved by the state legislature to raise money for education. Supporters have described it as a necessary step to modernize the state’s tax system.

“It’s not a penalty, and it’s not a regulatory fee,” Bernhardt said of the law, adding: “It benefits the entire public, and that’s the most important factor.”