Maryland State Wire

Maryland's legislative session concluded last week, leaving small businesses concerned about the state's economic direction. Despite ongoing financial struggles, new budget measures include increased taxes and fees affecting small enterprises.

The enactment of House Bill 352 has drawn criticism for its impact on funds that small businesses rely upon to create jobs, run operations, invest in employees, and contribute to their communities. A major point of contention is the newly introduced 3% "tech tax" on IT and data services. These services, essential for small businesses' success, span web hosting, cloud storage, and business software. Additionally, new income brackets for high earners and a 2% capital gains tax on those with a federally adjusted gross income of at least $350,000 were introduced.

Despite HB 352 passing, NFIB expressed gratitude towards Maryland's small business owners for their opposition, which led to the blocking of a B2B services tax and other significant tax hikes.

The small business sector also opposed other potential mandates, such as increased thresholds for overtime pay (HB582), potential hikes in unemployment insurance taxes (HB554), and another possible increase in the state’s minimum wage (HB1400). Moreover, NFIB played a role in delaying the state’s paid leave insurance program (HB102), which has postponed payroll deductions to January 1, 2027. The benefits of this program will follow in 2028.

NFIB remains committed to working with members of the Maryland General Assembly to highlight challenges facing small businesses. They encourage business owners to stay involved and follow future events despite the session’s adjournment.