Small businesses could see their annual corporate filing fee increased if a measure currently under consideration by the Maryland House passes the Legislature and is signed into law.
Currently, Maryland businesses play a flat annual corporate filing fee of $300 to maintain legal existence in the state. However, House Bill 691 seeks to change this fee structure to a progressive tax system based on a company’s fixed assets. The new filing fee schedule would range from $100 to $4,000:
- Family farms: $100
- Businesses with no taxable assets: $150
- $1-$10,000 in assets: $150
- $10,001-$25,000 in assets: $200
- $25,001-$50,000 in assets: $300
- $50,001-$100,000 in assets: $750
- $100,001-$150,000 in assets: $1,500
- $15,001-$200,000 in assets: $3,000
- More than $200,000 in assets: $4,000
The bill’s sponsors, including Dels. Vanessa Atterbeary and Dan Morhaim, say the bill seeks to be fair and keep small businesses from paying the same amount as bigger corporations. However, though the measure may be well-intentioned, it could end up hurting many of the small businesses that it seeks to help.
NFIB/MD State Director Mike O’Halloran testified against the bill during a committee hearing held in February. He explained that a small business can get up to $50,000 in taxable assets fairly quickly and included an example of a caterer he knew that would see a more-than-doubled filing fee because the business’ kitchen equipment is easily worth more than $50,000.
Champe McCulloch of Maryland Associated General Contractors also pointed out to the committee that this new system would punish businesses that are committed to Maryland and make substantial capital investments in the state.
