- Maryland enacted House Bill 898 on May 12, 2026, creating a tax exemption for certain digital and technology services within corporate groups.
- The exemption covers data services, IT services, software publishing, digital codes, and other digital products when buyer and seller are in the same affiliated group under IRC Section 1504.
- An affiliated group generally means a common-parent corporate chain with at least 80% ownership of voting power and value, subject to specific federal rules and exclusions.
- Internal transactions between related companies in the same corporate structure will no longer be treated as taxable supplies, reducing compliance costs.
- The exemption takes effect July 1, 2026, and businesses should review intra-group service and billing arrangements before then.
Source: vatabout.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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