ANNAPOLIS, Md. — Maryland’s highest court on Tuesday reversed a ruling by a lower court that the state’s first-in-the-nation tax on digital advertising was unconstitutional, saying the court lacked jurisdiction over the case.
Last year, the circuit court ruled that the tax on digital advertising violates the federal Internet Tax Freedom Act, which prohibits discrimination against electronic commerce. The court also held that the law violates the U.S. Constitution’s prohibition on state interference with interstate commerce.
Maryland Attorney General Anthony Brown praised the court’s ruling, saying the digital ad tax provides critical funding for a sweeping education reform law known as the Blueprint for Maryland’s Future. “This court has repeatedly held that constitutional claims are to be presented to the tax court. In case, after case, after case, almost every case involving a constitutional challenge to a state tax has come up through that way since the establishment of the tax court,” Bernhardt said.
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