# Part 2 – Energy Tax

Current through 2026-07-17. Source: City of Balt., Md., Ord. 26-129. Published by the Baltimore City Department of Legislative Reference.

## § 25-11 Definitions.

Balt., Md., Code art. 28, § 25-11 (2026)

(a) In this Part 2, the following terms have the meanings indicated.

(b) “Director” means the Director of Finance or the Director’s designee.

(c) “Energy” means artificial or natural gas, electricity, coal, fuel oil, liquefied petroleum gas, or steam delivered for consumption in Baltimore City.

(d)

  (1) “Revenue” means the total amount billed for the sale, delivery, or distribution of energy to users.

  (2) “Revenue” includes, by way of description and not limitation, the amount billed for energy or fuel cost adjustments, delivery or system charges, and service charges.

  (3) “Revenue” does not include finance charges, late payment charges, other government taxes or surcharges, the tax imposed by this Part, charges associated with the initial hook-up or re-connection to the vendor’s system.

(e) “User” includes any person that receives delivery of energy, other than for resale or for conversion into another form of energy subject to the tax imposed by this Part 2.

(f) “Vendor” means any person that delivers energy subject to the tax imposed by this Part 2 directly to a user.

*History: City Code, 1976/83, art. 28, §56A(a)*

*History: Ord. 22-125*

*History: Ord. 99-441*

*History: Ord. 04-728*

*History: Ord. 06-247*

## § 25-12 Tax imposed.

Balt., Md., Code art. 28, § 25-12 (2026)

There is levied and imposed a tax on energy delivered through pipes, wires, or conduits to all users in the City other than those exempted by this Part.

*History: Ord. 99-441*

*History: Ord. 04-728*

## § 25-13 Exemptions.

Balt., Md., Code art. 28, § 25-13 (2026)

The tax imposed by this Part 2 does not apply to energy delivered to any of the following:

(1) the United States and its agencies, unless subject to local tax under federal law;

(2) the State of Maryland and its agencies; and

(3) the City of Baltimore and its agencies.

*History: Ord. 99-441*

*History: Ord. 04-728*

## § 25-14 Rates.

Balt., Md., Code art. 28, § 25-14 (2026)

(a) For each fiscal year, the rates of the tax will be established as provided in this section.

(b) On or before the preceding February 1, each person that sells, distributes, or delivers energy shall certify to the Director, on the forms and in the manner required by the Director:

  (1) the aggregate units of energy (e.g., kWhs, therms, gallons, pounds, tons) supplied and delivered during the prior calendar year directly to all persons, governmental entities, instrumentalities, and units, and others, whether subject to or exempt from the tax imposed by this Part 2;

  (2) the aggregate revenues derived from the sale, distribution, or delivery of that energy; and

  (3) a breakdown of these aggregate units and revenues by class of user, as defined and prescribed by the Director.

(c)

  (1) For each class of energy and each class of user, the Director shall compute a base year tax rate for Fiscal Year 2005 by:

    (i) multiplying the sum of the revenues from each class of user for each class of energy by 0.08; and

    (ii) then dividing that product by the sum of the units of each class of energy delivered to the class of users.

  (2) For Fiscal Year 2011 and each subsequent fiscal year, the base year tax rate shall be the amount computed under paragraph (1) of this subsection, as adjusted under subsection (d) of this section, multiplied by 1.15%.

(d) For Fiscal Year 2006 and each subsequent fiscal year, these tax rates shall be adjusted by the percentage change in the Baltimore-Columbia-Towson Consumer Price Index, as reported by the United States Department of Labor, comparing December of the preceding calendar year to the December of the next preceding calendar year.

(e) For each of the following classes of users, the user is required to pay the following percentage of that year’s tax rate:

  (1) residential energy users subject to residential schedules on file with the Public Service Commission of Maryland –
– Fiscal Year 2005 and subsequent,  25%.

  (2) direct users of energy in manufacturing, assembling, processing, or refining operations that are exempt from the  Maryland State Retail Sales and Use Tax, but not including uses of energy for the following (for which the full tax shall be paid, as stated in paragraph(4) of this subsection):

    (A) maintaining, servicing, or repairing;

    (B) testing finished products;

    (C) providing for the comfort or health of employees;

    (D) operating administrative or commercial facilities, such as offices, sales or display rooms, retail outlets, and storage facilities (including refrigerated storage facilities); or

    (E) any other operations that the State Comptroller incorporates from time to time in the regulations governing the administration of the Maryland State Retail Sales and Use Tax, as those inclusions relate to manufacturing, assembling, processing, or refining –
– Fiscal Years 2005 and 2006, 25%; Fiscal Year 2007 and subsequent, 0%.

  (3) any nonprofit hospital, religious, charitable, or educational institution or organization, or any in-patient medical care or nursing facility licensed by the State or City Health Departments, with respect to energy used in carrying on the work of the nonprofit institution or organization or the in-patient medical care or nursing facility –
– Fiscal Year 2005, 0%; Fiscal Years 2006 through 2010, 75%; Fiscal Year 2011 and subsequent, 87% of the commercial rate imposed on the users listed in subitems (A) through (E) of item (2) of this subsection.

  (4) all other users –
– Fiscal Year 2005 and subsequent, 100%.

(f)

  (1) If a person that sells, distributes, or delivers energy fails to provide the certification required by subsection (b) of this section, the Director may use any reasonable data to establish a proposed rate of taxation.

  (2) A determination made by the Director is presumed valid.

(g)

  (1) The rates computed by the Director shall be included in the proposed operating budget submitted by the Director to the Board of Estimates.

  (2) After the adoption of the operating budget, the Director shall certify to each vendor the rates of tax for the fiscal year as included in the adopted budget.

*History: Ord. 99-441*

*History: Ord. 04-728*

*History: Ord. 10-300*

*History: Ord. 19-266*

## § 25-15 Collection.

Balt., Md., Code art. 28, § 25-15 (2026)

(a) Each vendor shall itemize the tax on each bill and collect the tax from the user.

(b) The vendor has the same rights against the user for collection of the tax as it has for collection of the energy bill.

*History: Ord. 99-441*

## § 25-16 Remittance.

Balt., Md., Code art. 28, § 25-16 (2026)

By the 25<sup>th</sup> day of the month, each vendor shall:

(1) file a return with the Director, under oath and on a form provided by the Director; and

(2) pay the amount of tax billed to a user for the preceding month.

*History: Ord. 99-441*

*History: Ord. 04-728*

## § 25-17 Refunds – Uncollectible accounts; tax erroneously paid.

Balt., Md., Code art. 28, § 25-17 (2026)

(a)

  (1) If a vendor is unable to collect an account receivable for which the tax already has been remitted and the vendor has charged off that account as worthless, the vendor may deduct the amount of the tax from its monthly remittance, subject to the requirements of this subsection.

  (2) The vendor must:

    (i) before availing itself of this privilege, provide the Director with a written statement of its policies governing the determination of worthless accounts; and

    (ii) as a condition of taking any deduction:

      (A) keep records of every worthless account for which the vendor has taken a deduction; and

      (B) make those records available to the Director, on request, for review or collection efforts.

(b) Whenever a tax imposed under this Part 2 has been erroneously, illegally, or unconstitutionally paid, the Director shall refund the tax if the application for refund:

  (1) is made within 3 years from the payment of the tax; and

  (2) states a proper ground for refund.

*History: Ord. 99-441*

## § 25-18 Refunds – Residential uses.

Balt., Md., Code art. 28, § 25-18 (2026)

(a) Any person that has paid the tax imposed under this Part 2 for any energy delivered to residential users or to combined residential and commercial users may apply annually to the Director for a refund of that portion of the taxes paid in excess of the applicable rate reasonably allocable to residential users only.

(b)

  (1) The application shall:

    (i) be signed by the applicant;

    (ii) contain a sworn affidavit as to the truth and accuracy of the information set forth in it;

    (iii) be filed not later than April 1 of each year; and

    (iv) cover the preceding 12 months.

  (2) Any application not received by April 1 in any particular year may not be given consideration.

(c)

  (1) The Director may refund that portion of the taxes determined to have been paid in connection with energy delivered to residential users only.

  (2) Subject to Title 4 {“Administrative Procedure Act – Regulations”} of the <cite data-path="|general">City General Provisions Article</cite>, the Director may adopt rules and regulations to assist in making that determination.

(d)

  (1) Any refund shall be made from a reserve fund created out of a portion of the tax receipts collected under this Part 2.

  (2) The reserve fund shall be in an amount estimated to be sufficient to pay the refunds authorized by this section.

*History: Ord. 99-441*

*History: Ord. 04-728*

*History: Text Conformed 02/25/21*

## § 25-19 Records.

Balt., Md., Code art. 28, § 25-19 (2026)

(a) Every vendor must:

  (1) keep complete and accurate records of all transactions, as necessary or otherwise required by the Director to determine whether taxes due under this Part 2 have been paid; and

  (2) make these records available, at all times during business hours, for inspection and audit by authorized representatives of the City.

(b) If a vendor fails to keep records from which the tax imposed by this Part 2 may be accurately computed, the Director may use criteria developed by surveying other taxpayers of the same type or otherwise, compute the amount of tax due, and this computation is presumed correct.

*History: Ord. 99-441*

*History: Ord. 04-728*

## § 25-20 Interest and civil penalties.

Balt., Md., Code art. 28, § 25-20 (2026)

If a vendor fails to pay the tax imposed by this Part 2 when due, the vendor must pay to the Director, in addition to the tax due:

(1) interest at the rate of 1% for each month or part of a month that the tax is overdue; and

(2) a penalty of 10% of the amount of the tax due.

*History: Ord. 99-441*

*History: Ord. 04-728*

## § 25-21 Rules and regulations.

Balt., Md., Code art. 28, § 25-21 (2026)

Subject to Title 4 {“Administrative Procedure Act – Regulations”} of the <cite data-path="|general">City General Provisions Article</cite>, the Director of Finance may adopt rules and regulations as necessary or appropriate:

(1) to insure the payment, collection, and accounting of the tax imposed by this Part 2; and

(2) to define or further define any terms used in this Part 2.

*History: Ord. 99-441*

*History: Ord. 04-728*

*History: Text Conformed 02/25/21*

## § 25-22

Balt., Md., Code art. 28, § 25-22 (2026)

Reserved

## § 25-23 Penalties.

Balt., Md., Code art. 28, § 25-23 (2026)

Any person who violates any provision of this Part 2 or of any rule or regulation adopted under this Part 2, or who makes any false statement or improper return, is guilty of a misdemeanor and, on conviction, is subject to a fine of not more than$1,000 or imprisonment for not more than 12 months or to both fine and imprisonment for each offense.

*History: Ord. 99-441*

*History: Ord. 04-728*