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Maryland Technology Services Tax –
Effective July 1, 2025
Maryland is introducing a new 3% sales and use tax on technology services used in the state. This law affects all service providers, including eTrepid. Here’s what you need to know.
Beginning July 1, 2025, Maryland will impose a 3% sales and use tax on many technology services. This applies to clients based in Maryland or using services within the state (e.g., remote employees). All providers—including eTrepid—are required to collect and remit this tax, which will appear as a line item on your invoice.
What's Being Taxed
Taxable services fall under the following NAICS categories:
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NAICS 518: Data processing, hosting, and related services
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NAICS 519: Information services
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NAICS 5415: Computer systems design and related services
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NAICS 5132: Software publishing services
These include services such as:
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Managed IT and cybersecurity
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Cloud storage, hosting, and backup
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Software licensing and subscriptions
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Web design and data analytics
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Custom software development (previously exempt)
Exemptions
You may be exempt if you:
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Resell the services
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Use services across multiple jurisdictions (MPU)
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Are a nonprofit or government entity
To claim exemption, submit:
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Maryland Resale Certificate
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Tax Exemption Certificate
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Multiple Points of Use (MPU) Certificate
Frequently asked questions
