Daily Record

The Senate is looking at a proposal to extend the state’s sales tax to more online transactions, a move that some in the business community and several Internet retailers are opposing.
The proposal (SB 1071) mirrors a New York state law designed to help tax collectors establish a connection between an online seller and the state. States have struggled to apply the sales tax to Internet and mail order companies because many sellers — such as Amazon.com Inc. in Maryland — do not have a physical presence in those states.
Under the proposal introduced two weeks ago by Sen. Richard S. Madaleno Jr., D-Montgomery, the state would consider online sellers’ relationships with in-state “affiliates,” which refer sales to the companies for commission, as a physical presence. The bill would garner about $7.8 million for the state each year, according to a legislative analysis.
The complicated bill faces difficult odds, because the General Assembly is scheduled to adjourn for the year Monday. Still, it has drawn interest from lawmakers because of the difficult budget situation that has consumed the state for the past few years.
Senate President Thomas V. Mike Miller Jr., D-Calvert and Prince George’s, has said he is supportive of the effort, and the bill moved quickly from introduction to hearing before the Senate Budget & Taxation Committee last week. Still, it only has days to clear both chambers and is facing intense opposition from groups including newspaper companies, online retailers, telecommunications companies and the Maryland Chamber of Commerce.
It has the backing of the Maryland Retailers Association, which sees it as a way to enhance physical stores’ ability to compete with online sellers.
Comptroller Peter Franchot is supporting the measure, spokesman Joseph Shapiro said Monday.