Maryland Sales Tax Attorney
Baltimore Maryland’s outdoor advertising excise tax
The U.S. Supreme Court has declined to review a Maryland Court of Appeals case that ruled the City of Baltimore’s outdoor advertising excise tax is constitutional. The taxpayer owns and operates hundreds of billboards subject to the tax. Under the ordinance, the tax is imposed on the privilege of exhibiting outdoor advertising displays in the city. Specifically, the tax is levied upon an advertising host, including a person who owns or controls a billboard, posterboard, or other sign, and charges fees for its use as an outdoor advertising display. The tax is assessed based upon the size of the display and whether it is an electronic display. A tax related to the sale of advertising on billboards is within the city’s taxing power and is entitled to a strong presumption of constitutionality. Differential taxation of media is subject to heightened or strict scrutiny under the First Amendment and Maryland Declaration of Rights when a tax suppresses or threatens particular ideas or viewpoints by: (1) singling out the press; (2) targeting a small group of speakers; or (3) discriminating on the basis of the content of taxpayer speech. In this case, there is no evidence that the ordinance, in intent or effect, is designed to censor or exert a prior restraint on the press. Also, the taxpayer’s billboard is primarily a commercial advertising vehicle and not a part of the press akin to a newsgathering organization. The fact that there are only four taxpayers affected by the ordinance is largely due to market conditions, and not to the structure of the ordinance (i.e., the city banned the construction of new billboards 20 years ago, which has effectively barred new entrants from challenging the taxpayer’s near monopoly of the medium). Finally, a distinction between off-premises and on-premises signs in a regulatory or tax law does not discriminate on the basis of content and, therefore, does not trigger heightened or strict scrutiny. (Clear Channel Outdoor, Inc. v. Director, Department of Finance of Baltimore City, Md. Ct. App., No. 9, September Term, 2020, 03/15/2021, cert. denied, U.S. S. Ct., Dkt. No. 21-219,
Maryland Sales Tax Attorney
