The Maryland Senate jumped on the Amazon tax bandwagon despite disappointing revenues and damaging results for a prior enactor. The bill targets Amazon and select others who states portray as state tax scofflaws.
Because companies such as Amazon lack direct physical presence in Maryland, the U.S. Supreme Court’s 1992 Quill ruling does not permit Maryland to require these Internet-based companies to collect Maryland sales tax. Despite having no physical presence, states can confer physical presence if a state can establish a formal relationship between the company and an in-state agent, representative, or salesperson. Maryland seeks to require Amazon and similar companies to collect Maryland sales tax based upon its relationship to its Maryland “affiliates”.