Unlike most other parts of the tax package, the computer services tax got little public vetting. Support for the proposal only coalesced in the final hours of the legislative session, effectively giving the industry no chance to object.
"I feel like I got into a ring and got smacked around without any warning, without any chance of a hearing, any chance of a discussion -- just boom, here it is," said Larry Letow, who owns Convergence Technology Consulting, a 30-person systems integration company in Glen Burnie.
The result of the rush to enact the tax will be a levy that is impossible to enforce, opponents say. John Nyland, IBM's senior executive in Maryland, said much will depend on whether the tax will apply to Maryland consumers buying services from companies in neighboring states or vice versa.
"If Maryland consumers have to pay the tax to in-state companies but not when they hire out-of-state companies to do that work, it puts the Maryland tech companies at a disadvantage," Nyland said.
Julie Coons, chief executive officer of the Tech Council of Maryland, said Connecticut's computer services tax has been fraught with disputes over its enforcement. She said two other states, Pennsylvania and Florida, approved similar taxes but quickly repealed them in the face of administrative difficulties.
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