Maryland lawmakers ended their 90-day legislative session last week amidst serious concerns over the state’s fiscal health. Despite the ongoing economic challenges Maryland’s small businesses face, the budget includes tax and fee increases on the state’s Main Street.

Unfortunately, House Bill 352 will take away funds small businesses use to create jobs, run their businesses, invest in their employees, and give back to their communities. The 3% “tech tax” on IT and data services will be felt by small businesses statewide as these services are critical to the success of small businesses including web hosting, cloud storage, and business software. Other provisions in the budget include two new income brackets for “high earners” and a 2% capital gains tax for taxpayers earning at least $350,000 on their federally adjusted gross income.

Although HB 352 became law, NFIB is thankful for Maryland’s small business owners who voiced their opposition to tax increases and successfully defeated the addition of a B2B services tax and other harmful increases!

The small business community also fought back other employer mandates like an increase to the overtime pay threshold (HB582), unemployment insurance tax hikes (HB554) and another increase to the state’s minimum wage (HB1400). NFIB also pushed for and succeeded in securing a delay to the state’s paid leave insurance program (HB102). Payroll deductions for the program will now be delayed until January 1, 2027, with benefits starting a year later in 2028.

NFIB will continue to engage with members of the Maryland General Assembly to ensure they are aware of the challenges facing our state’s small businesses. Stay tuned for upcoming events and other ways to stay involved while the session is adjourned.