Maryland Corporate Tax Modernization Encourages Business Growth
Montgomery County’s business climate was dramatically improved this spring when the corporate Single Sales Factor (SSF) apportionment formula was signed into law by Gov. Larry Hogan. This change means that companies that are operating in Maryland and serving customers nationally will be encouraged to expand their presence in our state. The new formula mirrors the same corporate tax structure that has benefited manufacturing companies by taxing only their sales value as opposed to sales, payroll, and property values.
“We see this tax reform as an opportunity for our knowledge-based economy to grow,” said David Petr, CEO & President of Montgomery County Economic Development Corporation (MCEDC). Thanks to the leadership in Annapolis, we envision becoming an even more attractive location that provides the atmosphere for businesses to grow, reinvest and diversify Montgomery County’s economy.”
The SSF legislation is effective for tax years starting after December 31, 2017 and will phase-in over five years. The Comptroller of Maryland has yet to clarify the rules regarding pass-through entities.