The computer services tax affects more businesses than you may think. Although IT providers will be the most deeply hurt, small and minority owned businesses, subcontractors and non-profits will also have to absorb the 6 percent tax.
The threat of the sales tax has scared companies into seriously considering relocating their IT divisions outside of Maryland. Some of these divisions employ hundreds of computer services professionals. Maryland's approximately 6,000 computer services firms employ almost 62,000 workers at an average annual salary of more than $85,000.
Losing these valuable services would affect virtually all businesses within the state. Those IT companies that choose to stay will have to increase their fees in order to survive.
- Non-profits will no longer be able to afford technology services
- Larger businesses that outsource their IT needs would have to create and budget for internal positions
- Research, development and federal government subcontracting is where the tax will fall most heavily
- Small and minority owned businesses will be at a disadvantage when competing against businesses that can afford IT services
This unfair tax does not only affect yuppies and geeks - it's going to cost jobs that will hurt everyone. States that have enacted this tax have experienced lagging economic activity, and because IT workforce is the backbone of Maryland's growth, our state will be hit especially hard. |
