# Subtitle 28 – Sales or Use Tax on Controlled Dangerous Substances

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

## § 28-1 Definitions.

Balt., Md., Code art. 28, § 28-1 (2026)

(a) In this subtitle, the following terms shall mean or include:

(b) “Assessment” means any amount of tax that has been imposed under this subtitle, together with all interest charges and penalties added.

(c) “Consignment” means the placement or deposit of controlled dangerous substances in the actual or constructive custody of a person for the purpose of:

  (1) selling the consigned controlled dangerous substances; and

  (2) remitting the proceeds of such sales, or portions of proceeds, to the person making the placement or deposit or a designee.

(d) “Controlled dangerous substances” or “controlled substances” are those defined in <cite data-doc="Md. Code" data-path="27|277">Article 27, § 277 of the Maryland Code</cite>.

(e) “Court” means a court of law or court of equity or any judge thereof, and includes the District Court of Maryland for Baltimore City, Circuit Court for Baltimore City, Court of Special Appeals, and Court of Appeals.

(f) “Director” means the Director of Finance for Baltimore City or a designee.

(g) “Narcotics operation” means any kind of private business for the sale, purchase, possession, transfer, or consignment of controlled dangerous substances, which business is comprised or carried out by more than 1 such activity, whether for profit or for any other consideration including accommodation to another person.

(h)

  (1) “Notice” shall mean actual notice or notice through documents:

    (i) which shall be delivered at the dwelling or usual place of business of the taxpayer, if the address is known or readily obtainable, and to a person 18 years of age or older; or

    (ii) which shall be sent by certified mail to the taxpayer’s last known address.

  (2) Any period of time which is determined according to the provisions of this subtitle by the giving of notice shall commence to run from the date of mailing of such notice.

(i)

  (1) “Records” or “business records” means all records of any type or form and however recorded which relates to a narcotics operation, or transaction, or profit therefrom.

  (2) These terms include books of account, vouchers, documents, canceled checks, payrolls, correspondence, records of purchase(s) or sale(s), accounts payable, accounts receivable, and records of personnel, or agents, or consignees, customers, equipment, production or import activities, and other business papers.

(j)

  (1) “Sale” means any transaction of any nature, wholesale, retail, or otherwise, whereby possession of a controlled dangerous substance is or is to be transferred by any means whatsoever for any consideration past, present, or future.

  (2) Consideration may be in the form of money, services, or property, or by exchange or barter, or pursuant to consignment.

  (3) Sale also includes transfer by theft or gift.

(k) “Taxpayer” means any person upon whom a tax is assessed under this subtitle.

(l) “Use, storage, or consumption” means the exercise by any person of any right or power over controlled dangerous substances, or any keeping or retention within Baltimore City for any purpose of controlled dangerous substances sold either within or without Baltimore City.

*History: Ord. 86-687*

*History: Ord. 22-124*

## § 28-2 Tax imposed.

Balt., Md., Code art. 28, § 28-2 (2026)

There is hereby levied and imposed a tax on each separate sale, or use, storage, or consumption of controlled dangerous substances within Baltimore City.

*History: Ord. 86-687*

## § 28-3 Rate of tax.

Balt., Md., Code art. 28, § 28-3 (2026)

The tax rate is 15% of the value in money of the controlled substance as evidenced by the actual money or money value consideration for its sale, or use, storage, or consumption or by its street value at or about the time of the taxable event.

*History: Ord. 86-687*

## § 28-4 Exemptions.

Balt., Md., Code art. 28, § 28-4 (2026)

This subtitle does not apply to sales, use, storage, or consumption by any person who registers under or complies with <cite data-doc="Md. Code" data-path="27|281">Article 27, § 281 of the Maryland Code</cite>, or any person who otherwise complies with that section of the Code.  The burden of proof of an exemption is upon the person claiming it.

*History: Ord. 86-687*

## § 28-5 Payment and assessment.

Balt., Md., Code art. 28, § 28-5 (2026)

(a) The tax shall be paid by the person who sells, stores, consumes, or steals the controlled dangerous substances subject to the tax.

(b) The tax is payable for each separate taxable event and every person who is a party to the event is jointly and severally liable for the payment of the tax, but the tax is not duplicated when there is in fact only 1 transaction or event.

(c) If written records, receipts, or other evidence or information demonstrate that controlled substances have been sold, used, stored, or consumed by any person, the Director may use such information to establish the amount of and to collect tax under the provisions of this subtitle.

(d)

  (1) The tax shall be due upon the event of the sale, use, storage, or consumption of taxable controlled dangerous substances and is payable to the Director within 15 days following the taxable event.

  (2) Payment, or satisfaction, of the assessed tax shall be made by certified or cashier’s check, money order or bank draft made payable to the Director.

(e) The Director shall, upon request, issue receipts for all sums collected pursuant to this subtitle.

*History: Ord. 86-687*

## § 28-6 Interest and civil penalties.

Balt., Md., Code art. 28, § 28-6 (2026)

All taxes upon controlled substances which are not paid within 15 days following the due date shall be overdue, and from and after that date they shall bear, until paid:

(1) interest at the rate of 2.5% for each month and fraction thereof; and

(2) penalty at the rate of 2.5% for each month and fraction thereof.

*History: Ord. 86-687*

## § 28-7 Tax made a lien.

Balt., Md., Code art. 28, § 28-7 (2026)

(a) Because of the nature of the transactions involved in the illegal sale, use, storage, or consumption of controlled dangerous substances, the Mayor and City Council find and declare that the collection of the tax imposed by this subtitle on such transactions is in jeopardy and requires the immediate attachment of a lien therefor from the time the tax is payable, subject to the revisions and appeals procedure provided.

(b) The tax imposed under this subtitle, and all increases, interest, and penalties thereon shall be a lien upon all the property, real and/or personal, of any person liable to pay the same to the City from and after the time that the tax is due and payable as provided herein.

(c) Notice of such lien shall be filed by the Director with the Clerk of the Circuit Court for Baltimore City or the Clerk of the Circuit Court of the county in which the property may be located, who shall accurately and promptly record and index all such notices of lien by entering such lien in the judgment docket of the court, stating the name of the delinquent taxpayer, the amount of the lien and the date thereof.

(d)

  (1) The lien provided for in this section shall have the full force and effect of a lien of judgment.

  (2) Unless another date is specified by law, the lien arising at the date of nonpayment as in this section specified and provided for, shall continue with the same force and effect as a judgment lien.

  (3) Any such lien on personal property shall not be effective as against an innocent purchaser for value unless the personal property has been levied upon by an officer of a court.

*History: Ord. 86-687*

## § 28-8 Assessment presumed valid and correct.

Balt., Md., Code art. 28, § 28-8 (2026)

(a) The tax, as assessed by the Director, with any penalties included therein, shall be presumed to be valid and correctly determined and assessed, and the burden shall be upon the taxpayer to show its incorrectness or invalidity.

(b) Any statement filed by the Director with the clerk of court, or any other certificate by the Director of the amount of tax and penalties as determined or assessed by him, shall be admissible as evidence and shall establish prima facie the facts that are set forth therein.

*History: Ord. 86-687*

## § 28-9 Collections.

Balt., Md., Code art. 28, § 28-9 (2026)

(a)

  (1) When the tax is not timely paid, the Director shall give notice of assessment to each person deemed liable for the unpaid tax, and any penalty and interest due, stating the amount owed and demanding payment thereof, provided that the Director under reasonable standards, uniformly applied, determines that the giving of the notice and the collection of the amount due are practicable.

  (2) Failure to give or receive notice does not relieve a taxpayer of the obligation and liability for payment of any tax, interest, and penalty due.

(b) Notice of assessment and notice of lien under this subtitle shall be given not more than 3 years:

  (1) after the sale, use, storage, or consumption of the controlled substances;

  (2) after the seizure of records pursuant to an investigation of sales, use, storage, or consumption of such substances; or

  (3) after the disposition of criminal charges or arrest or indictment resulting from the sale, use, storage, or consumption of such substances,
whichever occurrence is latest in time.

*History: Ord. 86-687*

## § 28-10 Refunds.

Balt., Md., Code art. 28, § 28-10 (2026)

(a) Any taxpayer may apply to the Director for refund of tax alleged to have been erroneously, illegally, or unconstitutionally paid.

(b) Application for refund must:

  (1) be made in writing;

  (2) be made within 1 year of the payment of the tax; and

  (3) state the reasons why the taxpayer believes a refund is due.

(c) The Director:

  (1) shall act upon such application promptly; and

  (2) shall provide notice to the taxpayer of the action.

*History: Ord. 86-687*

## § 28-11 Revisions.

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

(a) Any taxpayer may apply in writing, stating the basis therefor, to the Director for a revision of the tax assessed against him.

(b)

  (1) Any request for a revision must be made within 15 days of the date on which the Director notifies the taxpayer of tax due pursuant to this subtitle.

  (2) If no application for revision is made within the 15 day period, the assessment is final.  No application for revision shall be considered by the Director unless made within that period.

(c) The Director:

  (1) shall act upon such application promptly; and

  (2) shall provide notice to the taxpayer of the action.

*History: Ord. 86-687*

## § 28-12 Appeal of decision on refund or revision.

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

(a)

  (1) Within 15 days of notice of action by the Director on the taxpayer’s application for revision or refund of an assessment, the taxpayer may request a formal hearing before the Director.

  (2) The Director shall grant a hearing and shall give the taxpayer reasonable notice of the time, date, and place of the hearing.

(b) The Director shall have the power:

  (1) to administer oaths; and

  (2) to prescribe all necessary and reasonable rules for the conduct of a hearing.

(c)

  (1) After a hearing, the Director:

    (i) shall make a determination concerning any revision of the assessment, or grant or refuse a refund; and

    (ii) shall provide notice to the taxpayer of this determination.

  (2) In addition, the Director may levy a deficiency assessment against the taxpayer for any additional taxes found to be due.

(d)

  (1) A taxpayer dissatisfied with the Director’s final determination may seek judicial review of that decision by petition to the Circuit Court for Baltimore City in accordance with the Maryland Rules of Procedure.

  (2) A party to the judicial review may appeal the court’s final judgment to the Court of Special Appeals in accordance with the Maryland Rules of Procedure.

*History: Ord. 86-687*

*History: Ord. 04-672*

## § 28-13 Confidentiality of information.

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

(a)

  (1) The testimony or evidence of any person compelled to testify in a tax proceeding under this subtitle shall not be used against that person in any criminal proceeding, except for perjury in the tax proceeding.

  (2) The Director shall not release the compelled testimony of any person to any law enforcement agency for direct or derivative use, except for perjury.

  (3) However, if by independent evidence a law enforcement agency makes a criminal case against a compelled witness using evidence independent of and not derived from the compelled testimony, such law enforcement agency shall be free to proceed with the case.

(b)

  (1) It shall be unlawful for the Director or any other public official or employee to divulge or otherwise make known in any manner any particular set forth or disclosed in any report or return required by this subtitle or records used to determine the amount of assessment except in connection with a proceeding involving taxes due under this subtitle or any state or federal law.

  (2) However, any records, receipts, or other information seized by any law enforcement officer or taxation official in any investigation may be returned to the seizing law enforcement or taxation agency upon request for said return.

(c) Nothing herein shall be construed to prohibit the publication of statistics so classified as to prevent the identity of particular reports or returns and the items thereof.

*History: Ord. 86-687*

## § 28-14 Liability not abated by death.

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

Taxes, penalties, and interest assessed under this subtitle shall not abate by death of taxpayer.

*History: Ord. 86-687*

## § 28-15 Rules and regulations.

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

Subject to Title 4 {“Administrative Procedure Act – Regulations”} of the <cite data-path="|general">City General Provisions Article</cite>, the Director may promulgate such rules, regulations, and procedures as are necessary or appropriate to administer this subtitle.

*History: Ord. 86-687*

*History: Text Conformed 02/25/21*

## § 28-16 Judicial assistance.

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

The Director may apply to a court of competent jurisdiction for an order compelling such testimony, records, or evidence under proper safeguards as the court may deem necessary or appropriate to carry out the provisions of this subtitle.

*History: Ord. 86-687*

## § 28-17 Compromise of claims.

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

(a) Whenever it is ascertained by the Director or the City Solicitor that a lesser sum may be collected than the total taxes, penalties, and interest due, the City Solicitor shall be authorized to:

  (1) compromise the claim;

  (2) accept the lesser sum on behalf of the Director; and

  (3) issue a release of the claim or satisfaction of the judgment as though the same had been paid in full.

(b) Such compromise is authorized only in such cases where the City Solicitor and the Director concur that the full amount would be uncollectible.

*History: Ord. 86-687*

## § 28-18

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

Reserved

## § 28-19 Criminal and civil penalties.

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

(a) Evasion of payment or the willful refusal on the part of any person to pay taxes over to the Director as required by this subtitle shall be a misdemeanor and upon conviction the person is subject:

  (1) to imprisonment not exceeding 12 months or to a fine not exceeding $1,000, or both; and

  (2) additionally, to a civil penalty of 100% of the amount of the assessment, in addition to the actual assessment provided by this subtitle.

(b) Willful refusal is evidenced by failure to pay the full amount due within 15 days of the date of the assessment.

*History: Ord. 86-687*