The sales and use tax does not apply to a sale of the following items for an agricultural purpose: livestock; feed or bedding for livestock; seed, fertilizer, fungicide, herbicide, or insecticide; baler twine or wire; fuel for use in farm equipment or a farm tractor, as defined in §§ 11–120 and 11–121 of the Transportation Article; and if bought by a farmer: a container to transport farm products that the farmer raises to market; a farm vehicle, as defined in § 13–911(c) of the Transportation Article, when used in farming; a milking machine, when used in farming; fabrication, processing, or service, by a sawmill, of wood products for farm use in which the farmer retains title; and farm equipment when used to: raise livestock; prepare, irrigate, or tend the soil; or plant, service, harvest, store, clean, dry, or transport seeds or crops. Except for flowers, sod, decorative trees and shrubs, and any other product that usually is sold by a nursery or horticulturist, the sales and use tax does not apply to a sale of an agricultural product by a farmer.

In this section, “bulk vending machine” means a vending machine that: contains unsorted merchandise; and on insertion of a coin, dispenses the unsorted merchandise in approximately equal portions at random and without selection by the customer. The sales and use tax does not apply to a sale of tangible personal property through a bulk vending machine for a taxable price of 75 cents or less.

The sales and use tax does not apply to: a sale to a cemetery company, as described in § 501(c)(13) of the Internal Revenue Code in effect on July 1, 1987; a sale to a credit union organized under the laws of the State or of the United States; a sale to a nonprofit organization made to carry on its work, if the organization: is located in the State; is located in an adjacent jurisdiction and provides its services within the State on a routine and regular basis; or is located in an adjacent jurisdiction whose law: does not impose a sales or use tax on a sale to a nonprofit organization made to carry on its work; or contains a reciprocal exemption from sales and use tax for sales to nonprofit organizations located in adjacent jurisdictions similar to the exemption allowed under this subsection; is a charitable, educational, or religious organization; is not the United States; and except for the American National Red Cross, is not a unit or instrumentality of the United States; a sale, not exceeding $500, to a nonprofit incorporated senior citizens’ organization made to carry on its work, if the organization: is located in the State; and receives funding from the State or a political subdivision of the State; a sale to a volunteer fire company or department or volunteer ambulance company or rescue squad located in the State made to carry on the work of the company, department, or squad; a sale of tangible personal property, a digital code, or a digital product to a nonprofit parent–teacher association located in the State if the association makes the purchase to contribute the property to a school to which a sale is exempt under item (3) of this subsection or § 11–220 of this subtitle; a sale to a nonprofit organization made to carry on its work, if the organization: is qualified as tax exempt under § 501(c)(4) of the Internal Revenue Code; and is engaged primarily in providing a program to render its best efforts to contain, clean up, and otherwise mitigate spills of oil or other substances occurring in United States coastal and tidal waters; or a sale to a bona fide nationally organized and recognized organization of veterans or an auxiliary of the organization or one of its units, if the organization is qualified as tax exempt under § 501(c)(4) or § 501(c)(19) of the Internal Revenue Code. The sales and use tax does not apply to a sale by: a bona fide church or religious organization, if the sale is made for the general purposes of the church or organization; a gift shop at a mental hospital that the Maryland Department of Health operates; a hospital thrift shop that: is operated by all volunteer staff; sells only donated articles; contributes the profits from sales to the hospital with which the shop is associated; and is not operated in conjunction with a gift shop or another retail establishment; a vending facility operated under the Maryland Vending Program for the Blind if: the facility is located on property held or acquired by or for the use of the United States for any military or naval purpose; and a post exchange or other tax–exempt concession is located and operated on the same property; an elementary or secondary school in the State or a nonprofit parent–teacher organization or other nonprofit organization within an elementary or secondary school in the State for the sale of magazine subscriptions in a fund–raising campaign, if the net proceeds are used solely for the educational benefit of the school or its students, including a sale resulting from an agreement or contract with an organization to participate in a fund–raising campaign for a percentage of the gross receipts under which students act as agents or salespersons for the organization by selling or taking orders for the sale; a parent–teacher organization or other organization within an elementary or secondary school in the State or within a school system in the State; subject to subsection (e) of this section, a bona fide church, religious organization, or other nonprofit organization exempt from taxation under § 501(c)(3) of the Internal Revenue Code if: the sale is made at an auction sale; and the proceeds of the sale are used to carry on the exempt purposes of the church or organization; a nonprofit organization exempt from taxation under § 501(c)(3) of the Internal Revenue Code that maintains a memorial on property that is owned by the State if the proceeds of the sale are used to maintain a memorial on property that is owned by the State; or an elementary or secondary school in the State or a nonprofit parent–teacher organization or other nonprofit organization within an elementary or secondary school in the State if the sale is made at a book fair held in–person on the premises of the school and the net proceeds are used solely for the educational benefit of the school or its students, including a sale resulting from an agreement or a contract with an organization to participate in a book fair for a percentage of the gross receipts under which students, teachers, school staff, or members of the parent–teacher organization or other nonprofit organization within an elementary or secondary school act as agents or salespersons for the third–party vendor by managing the book fair. To qualify as an organization to which a sale is exempt under subsection (a)(3) or (5) of this section, the organization shall file an application for an exemption certificate with the Comptroller. The Comptroller may treat the possession of an effective determination letter of status under § 501(c)(3) or (13) of the Internal Revenue Code from the Internal Revenue Service as evidence that an organization qualifies under subsection (a)(3) or (5) or (1) of this section, respectively. For a sale described under subsection (b)(7) of this section that is not otherwise exempt under this section, only that part of the sale price that qualifies for a deduction under the federal income tax as a charitable contribution under the regulations and guidelines of the Internal Revenue Service is exempt from the sales and use tax under this section.

The sales and use tax does not apply to a sale of: a Maryland State flag; a United States flag; or a prisoner of war flag or missing in action flag honoring and remembering military personnel who have served in the armed forces of the United States.

In this section the following words have the meanings indicated. “Facility for food consumption” does not include parking spaces for vehicles as the sole accommodation. “Food” means food for human consumption. “Food” includes the following foods and their products: beverages, including coffee, coffee substitutes, cocoa, fruit juices, and tea; condiments; eggs; fish, meat, and poultry; fruit, grain, and vegetables; milk, including ice cream; and sugar. “Food” does not include: an alcoholic beverage as defined in § 5–101 of this article; a soft drink or carbonated beverage; a cannabinoid beverage as defined in § 36–101 of the Alcoholic Beverages and Cannabis Article; or candy or confectionery. “Food for immediate consumption” means: food obtained from a salad, soup, or dessert bar; party platters; heated food; sandwiches suitable for immediate consumption; or ice cream, frozen yogurt, and other frozen desserts, sold in containers of less than 1 pint. “Premises” includes any building, grounds, parking lot, or other area that: a food vendor owns or controls; or another person makes available primarily for the use of the patrons of 1 or more food vendors. “Substantial grocery or market business” means a business at which at least 10% of all sales of food are sales of grocery or market food items, not including food normally consumed on the premises even though it is packaged to carry out. The sales and use tax does not apply to a sale of food stamp eligible food, as defined in 7 U.S.C. § 2012, bought with a food coupon issued in accordance with 7 U.S.C. § 2016. Except as provided in paragraph (2) of this subsection, the sales and use tax does not apply to a sale of food for consumption off the premises by a food vendor who operates a substantial grocery or market business at the same location where the food is sold. The exemption under paragraph (1) of this subsection does not apply to: food that the vendor serves for consumption on the premises of the buyer or of a third party; or food for immediate consumption. The sales and use tax does not apply to: a sale of food: to patients in a hospital when the food charge is included in the regular room rate; by a church or religious organization; by a school other than an institution of postsecondary education, including sales at a school by a food concessionaire that is under contract with the school or with its designated contract agent, but not including sales at events that are not sponsored by the school or are not educationally related; to students at an institution of postsecondary education if the food charge is for a meal plan or is included in the regular charge for room and board; or by a nonprofit food vendor if there are no facilities for food consumption on the premises, unless the food is sold within an enclosure for which a charge is made for admission; if the proceeds of the sale are used to support a bona fide nationally organized and recognized organization of veterans or auxiliary of the organization or 1 of its units, a sale of food or meals for consumption only on the premises, served by the organization or auxiliary; if the proceeds of the sale are used to support a volunteer fire company or department or its auxiliary or a volunteer ambulance company or rescue squad or its auxiliary, a sale of food served by the company, department, squad, or auxiliary; or a sale of food, bottled water, soft drink or carbonated beverage, or candy or confectionery by a nonprofit food vendor at a youth sporting event or 4–H youth event for individuals under the age of 18 years if there are no facilities for food consumption on the premises, unless the sale is within an enclosure for which a charge is made for admission. The sales and use tax does not apply to a sale of food or any beverage in a vehicle that is being operated in the State while in the course of interstate commerce. The sales and use tax does not apply to a sale for consumption off the premises of: crabs; or seafood that is not prepared for immediate consumption. The sales and use tax does not apply to the sale through a vending machine of milk, fresh fruit, fresh vegetables, or yogurt.

The sales and use tax does not apply to: a sale of electricity, steam, or artificial or natural gas for use in residential condominiums; a sale of electricity, steam, or artificial or natural gas that is delivered under a residential or domestic rate schedule on file with the Public Service Commission; a sale of coal, firewood, heating oil, or propane gas or similar liquefied gas for use in residential property that contains not more than 4 units, cooperative housing, condominiums, or other similar residential living arrangements; a sale of electricity through 3 or more bulk meters for use in a nonprofit planned retirement community of more than 2,000 housing cooperative or condominium units if: ownership of units is restricted by age; any unit is served by an individual meter; and on or before July 1, 1979, at least 3 bulk meters served the community; or a sale of electricity generated by solar energy equipment or residential wind energy equipment, as defined under § 11–230 of this subtitle, for use in residential property owned by an eligible customer–generator under § 7–306 of the Public Utilities Article. The sales and use tax does not apply to a sale of wood, wood bark or residue, or refuse-derived fuel used for heating purposes.

The sales and use tax does not apply to: a sale of equipment or machinery that is used only to load, unload, and handle cargo of ocean going vessels within an international marine terminal; or a rental of equipment or machinery that: is owned by the Maryland Port Administration; and is used only to load and unload ocean going vessels. The sales and use tax does not apply to a sale of film, video tape, or a digital product for use only in television broadcasting by a television station that the Federal Communications Commission licenses specifically to broadcast to a city or town outside the State. The sales and use tax does not apply: to a sale of an aircraft, motor vehicle, railroad rolling stock, or vessel that is used principally to cross State lines in interstate or foreign commerce; to a sale of a replacement part, other tangible personal property, or a digital product to be used physically in, on, or by a conveyance described in item (1) of this subsection; or except for a rental, to a sale of a motor vehicle, other than a house or office trailer, that will be titled or registered in another state.

The sales and use tax does not apply to a casual and isolated sale by a person who regularly does not sell tangible personal property, a digital code, a digital product, or a taxable service if: the sale price is less than $1,000; and the sale is not made through an auctioneer or a dealer. The sales and use tax does not apply to a distribution of tangible personal property, a digital code, or a digital product by: a corporation or joint–stock company to its stockholders as a liquidating distribution; a partnership to a partner; or a limited liability company to a member. The sales and use tax does not apply to a transfer of tangible personal property, a digital code, or a digital product: under a reorganization within the meaning of § 368(a) of the Internal Revenue Code; on organization of a corporation or joint–stock company, to the corporation or company principally in consideration for the issuance of its stock; to a partnership only as a contribution to its capital or in consideration for a partnership interest in the partnership; or to a limited liability company only as a capital contribution or in consideration for an interest in the limited liability company. For a transfer that would qualify as a casual and isolated sale under subsection (a) of this section if the sale price limitation were disregarded, the amount of liability transferred to or assumed by a corporation, joint–stock company, partnership, or limited liability company shall be excluded from the consideration transferred by the corporation, joint–stock company, partnership, or limited liability company in exchange for the tangible personal property, digital code, or digital product to determine whether the transfer is made: principally in consideration for the issuance of stock of a corporation or joint–stock company; only as a contribution to the capital of a partnership or in consideration for a partnership interest; or only as a capital contribution to a limited liability company or in consideration for an interest in a limited liability company.

The sales and use tax does not apply to a sale of: machinery or equipment used to produce bituminous concrete; or electricity, fuel, and other utilities used to operate that machinery or equipment. The sales and use tax does not apply to a sale of: tangible personal property, a digital code, or a digital product used directly and predominantly in a production activity at any stage of operation on the production activity site from the handling of raw material or components to the movement of the finished product, if the tangible personal property, digital code, or digital product is not installed so that it becomes real property; a melting, smelting, heating, or annealing coke oven, aluminum furnace, anode bake oven, electrolytic pot, cathode, refractory, or other material used in relining and rebuilding a furnace or oven; or a foundation to support other machinery or equipment or an item required to conform to an air or water pollution law and normally considered part of real property. The sales and use tax does not apply to a sale of equipment that is used by a retail food vendor to manufacture or process bread or bakery goods for resale if: the taxable price of each piece of equipment is at least $2,000; and the retail food vendor operates a substantial grocery or market business, as defined in § 11–206(a) of this subtitle, at the same location where the food is sold. The sales and use tax does not apply to the sale, on or after January 1, 2000, but before January 1, 2008, of machinery or equipment: that enables a television or radio station to originate and broadcast or to receive and broadcast digital signals; and that was or is purchased to comply with or to facilitate compliance with the Telecommunications Act of 1996, Pub. L. 104–104, 110 Stat. 56. The sales and use tax does not apply to the sale of: machinery or equipment used directly and predominantly to produce Energy Star windows or Energy Star entry doors for residential real property; or electricity, fuel, and other utilities used to operate that machinery or equipment.

The sales and use tax does not apply to: a sale, to or by a physician or hospital, of drugs or medical supplies; a sale of medicine; a sale of disposable medical supplies; or a sale of a patient’s medical records to the patient or the patient’s representative. The sales and use tax does not apply to a sale of: a hemodialysis drug or device, by a licensed pharmacist or by a person who holds a permit under § 12–603 of the Health Occupations Article, directly to a hemodialysis patient requiring regular home treatment; tangible personal property that is manufactured or adapted specifically to compensate for blindness, including braille slates and paper, items with braille markings, preset insulin syringes, and raised line drawing kits; a decoder for captioned television programs for use by a hearing–impaired individual; a telecommunications device that is adapted specifically for hearing–impaired individuals and is: a device that changes digital codes into tones for transmission through telephone lines; a flashing signal device; or a telebraille machine; an artificial eye, hearing device, or limb; a colostomy or ileostomy appliance; corrective eyeglasses; an orthopedic or surgical appliance prescribed by a physician and designed to be worn on the person of the user; a battery for an artificial hearing device or larynx, transcutaneous nerve stimulator, or electrically powered wheelchair; a custom–made earmold for an artificial hearing device; a battery charger for an artificial hearing device; or a receiver for an artificial hearing device; crutches; a wheelchair; a hospital bed; an oxygen tent; any other sickroom equipment that the Comptroller defines by regulations or medical equipment that: can withstand repeated use; is used exclusively to serve a medical purpose; is not useful to a person in the absence of illness or injury; and is for use in the home or on the individual’s person; tangible personal property for installation in a motor vehicle: to provide access to the motor vehicle by an individual with a disability; or to permit an individual with a disability to operate the motor vehicle; a wig or hairpiece needed as a result of documented medical or surgical treatment; nicotine patches, nicotine gum, or any other product intended for use as an aid in tobacco use cessation and approved by the United States Food and Drug Administration for that purpose; tangible personal property that is manufactured for the purpose of initiating, supporting, or sustaining breast–feeding, including breast pumps, breast pump kits, nipple enhancers, breast shields, breast shells, supplemental nursing systems, softcup feeders, feeding tubes, breast milk storage bags, periodontal syringes, finger feeders, haberman feeders, and purified lanolin; baby bottles or baby bottle nipples; a medical or clinical thermometer; a pulse oximeter; a blood pressure monitor; an N95, China KN95, Japan DS, Korea 1st Class, AS/NZS P2, or European FFP2 filtering facepiece respirator; or diabetic care items, including insulin, glucose tablets, glucose drinks, glucose gels, blood and urine ketone meters and supplies, insulin pumps, insulin pump infusion sets, insulin pump reservoirs or cartridges, continuous glucose monitors and related supplies, syringes, insulin injection devices, insulin pens, insulin pen needles, lancets and lancet devices, and testing strips for measuring blood sugar. The sales and use tax does not apply to a sale of: baby oil or baby powder; diapers; diaper rash cream; baby wipes; toothbrushes, toothpaste, tooth powders, mouthwash, dental floss, or other similar oral hygiene products; or sanitary pads, tampons, menstrual sponges, menstrual cups, or other similar feminine hygiene products.

The sales and use tax does not apply to a sale of: fabrication, processing, or service, by a sawmill, of wood products for mine use in which the miner retains title; or diesel fuel for use in reclamation of land that has been mined for coal by strip or open-pit mining.

Except for the first retail sale of the manufactured home, the sales and use tax does not apply to a sale of a manufactured home, as defined in § 12-301(g) of the Public Safety Article.

The sales and use tax does not apply to use of tangible personal property, a digital code, a digital product, or a taxable service that: a nonresident: acquires before the property, digital code, digital product, or service enters the State; and uses: for personal enjoyment or use or for a use that the Comptroller specifies by regulation, other than for a business purpose; or in a presentation or in conjunction with a presentation of an exhibit, show, sporting event, or other public performance or display; and does not remain in the State for more than 30 days.

In this section: “precious metal bullion or coins” means: any precious metal that has gone through a refining process and is in a state or condition such that its value depends on its precious metal content and not on its form; or except as provided in paragraph (2) of this subsection, monetized bullion, coins, or other forms of money that: are manufactured from precious metals; and are or have in the past been used as a medium of exchange under the laws of the State, the United States, or a foreign nation; and “precious metal bullion or coins” does not include jewelry or a work of art made of precious metal bullion or coins. The sales and use tax does not apply to a sale of precious metal bullion or coins if the sale price is greater than $1,000.

The sales and use tax does not apply to a sale of art works, electros, electrotypes, hand or machine compositions, lithographic plates or negatives, mats, photoengravings, stereotypes, or typographies: to a person engaged in the printing of tangible personal property for sale; and for direct use by the person to produce that property for sale. A vendor who sells any item under paragraph (1) of this subsection is not entitled to any exclusion under § 11–101(h)(3)(ii) or (n)(3)(ii) of this title for material that the vendor buys to produce that item. The sales and use tax does not apply to the printing and sale of newspapers that are distributed by the publisher at no charge. A publication is not a newspaper unless it is published and distributed at least once per month and it meets other criteria as defined by the Comptroller. The sales and use tax does not apply to: a sale of direct mail advertising literature and mail order catalogues that will be distributed outside the State, and a sale of computerized mailing lists to the extent used for the purpose of providing addresses to which direct mail advertising literature and mail order catalogues will be distributed outside the State; or a sale of government documents, publications, records, or copies by the federal or State or a local government or an instrumentality of the federal or State or a local government.

The sales and use tax does not apply to: a sale for use of tangible personal property, a digital code, or a digital product that: is bought outside this State; is intended solely for use in another state; and is stored in this State pending shipment to another state; a sale of tangible personal property to a person obligated under a contract to incorporate that property into real property located in another state where the purchase or use of that property would not be subject to a sales tax, use tax, or similar tax; or except for that portion of the purchase price allocable to intended viewing in this State, a sale of a series of images stored on video tape or in other optical or digital forms or electronic signals generated from these images to a cable or other nonbroadcast television network, if the images are intended for viewing by television viewers located outside the State. The sales and use tax shall be paid: on a sale under subsection (a)(1) of this section, when the tangible personal property is imported or stored in the State; and on a sale under subsection (a)(2) of this section, when the sale is made. A person who pays the sales and use tax under subsection (b) of this section may obtain the exemption by: filing a claim for refund with the Comptroller when the property is removed from the State; and providing the Comptroller with the evidence that the Comptroller requires by regulation, including: evidence of use or removal of the property from the State; and satisfactory proof of entitlement to exemption in another state.

In this section, “research and development” means: basic and applied research in the sciences and engineering; and the design, development, and governmentally required pre-market testing of prototypes, products, and processes. “Research and development” does not include: market research; research in the social sciences or psychology and other nontechnical activities; routine product testing; sales services; or technical and nontechnical services. The sales and use tax does not apply to a sale of tangible personal property, a digital code, or a digital product for use or consumption in research and development.

The sales and use tax does not apply to a sale of: a clam or oyster rake, crab bait, crab or eel pot, or fish net; a dredge, handscrape, or hand or patent tong; or fuel or a repair part for a commercial fishing vessel or for a vessel otherwise used for commercial purposes.

The sales and use tax does not apply to a personal, professional, or insurance service that: is not a taxable service; and involves a sale as an inconsequential element for which no separate charge is made. The sales and use tax does not apply to the sale of an optional computer software maintenance contract if the buyer does not have a right, as part of the contract, to receive at no additional cost software products that are separately priced and marketed by the vendor. The sales and use tax does not apply to the use of a taxable service obtained by using a prepaid telephone calling arrangement. In this subsection the following words have the meanings indicated. “Cloud computing” means a service that enables on–demand, self–service network access to a shared pool of configurable computer resources, including data storage, analytics, commerce, streaming, e–mail, document sharing, and document editing. “Qualified cybersecurity business” means an entity organized for profit that is engaged primarily in the development of innovative proprietary cybersecurity technology or the provision of cybersecurity services. The sales and use tax imposed on a taxable service described under § 11–101(m)(14) or (15) of this title does not apply to a sale of cloud computing to a qualified cybersecurity business.

The sales and use tax does not apply to a sale to the State or a political subdivision of the State. The exemption under subsection (a) of this section may not be construed to exempt any sale of tangible personal property, a digital code, or a digital product, otherwise taxable under this title, to a contractor to be used under a contract with the State or a political subdivision of the State for construction, repair, or alteration of real property.

The sales and use tax does not apply to: a sale of an admission by a person whose gross receipts from the sale are subject to the admissions and amusement tax; a sale of a communication service, other than a taxable service, rendered by a person whose charge for a communication service is or would be subject to the federal excise tax as described in § 4251 of the Internal Revenue Code in effect on July 1, 1979; a sale of a motor fuel that is subject to the motor fuel tax or the motor carrier tax; except for a rental, a sale of a motor vehicle, other than a house or office trailer, that is subject to the motor vehicle excise tax under § 13-809 or § 13-811 of the Transportation Article; a lease of a motor vehicle that is leased for a period of at least 1 year; a rental of a motion picture, motion picture trailer, or advertising poster for display on theater premises by a person whose gross receipts from the activity related to the rental is subject to the admissions and amusement tax; or except for a rental, a sale of a vessel that is subject to the excise tax under § 8-716 of the Natural Resources Article. If a person who buys tangible personal property, a digital code, a digital product, or a taxable service in a retail sale pays the sales and use tax when the retail sale is made, the person is not required to pay the tax again when the person uses that tangible personal property, digital code, digital product, or taxable service in the State. To the extent that a buyer pays another state a tax on a sale or gross receipts from a sale of tangible personal property, a digital code, a digital product, or a taxable service that the buyer acquires before the property, digital code, digital product, or service enters this State, the sales and use tax does not apply to use of the property or service in this State. If the tax paid to another state is less than the sales and use tax, the buyer shall pay the difference between the sales and use tax and the amount paid to the other state in accordance with the formula under § 11–303(b) of this title. A retail sale of a digital product subject to tax under this title does not include a retail sale that is subject to tax in accordance with any other provision of this article.

The sales and use tax does not apply to a sale of deliverable end item testing equipment that is used to perform a contract for the United States Department of Defense and that, under the terms of the contract, is to be transferred to the federal government, if the contract is awarded as a result of a bid submitted after June 1, 1986.

The sales and use tax does not apply to a sale of: a bus to a person who uses the bus only: in the operation of the transportation system of a political subdivision of the State; and for public transportation on regular schedules and between fixed termini, as defined in Title 11 of the Transportation Article; or a transportation service.

The sales and use tax does not apply to a sale of water that is delivered to the buyer through pipes or conduits.

In this section, “computer program” means a set of statements or instructions to be used directly or indirectly in a computer in order to bring about a certain result. The sales and use tax does not apply to a sale of a computer program that is legally permitted to be and is intended to be: reproduced for sale; or incorporated in whole or in part into another computer program intended for sale.

In this subsection, “Energy Star product” means an air conditioner, clothes washer or dryer, furnace, heat pump, standard size refrigerator, compact fluorescent light bulb, dehumidifier, boiler, or programmable thermostat that has been designated as meeting or exceeding the applicable Energy Star efficiency requirements developed by the United States Environmental Protection Agency and the United States Department of Energy. Beginning in calendar year 2011, the weekend that consists of the Saturday immediately preceding the third Monday in February through the third Monday in February each year shall be a tax–free weekend during which the exemption under paragraph (3) of this subsection shall apply. During the tax–free weekend established under paragraph (2) of this subsection, the sales and use tax does not apply to the sale of any: Energy Star product; or solar water heater. The sales and use tax does not apply to the sale of a multifuel pellet stove designed to burn agricultural field corn.

In this section the following words have the meanings indicated. “Film production activity” means the production or postproduction of film or video projects including feature films, television projects, commercials, corporate films, infomercials, music videos, or other projects for which the producer or production company will be compensated, and which are intended for nationwide commercial distribution. “Film production activity” includes the production or postproduction of digital, animation, and multimedia projects. “Film production activity” does not include: production or postproduction of student films or noncommercial personal videos; or any activity not necessary to and undertaken directly and exclusively for the making of a master film, tape, or image. “Tangible personal property, a digital code, a digital product, or a taxable service used directly in connection with a film production activity” includes: camera equipment and supplies; film and tape; lighting and stage equipment and supplies; sound equipment and supplies; recording equipment and supplies; costumes, wardrobes, and materials to construct them; props, scenery, and materials to construct them; design supplies and equipment; drafting supplies and equipment; special effects supplies and equipment; short–term vehicle rentals; and fabrication, printing, or production of scripts, storyboards, costumes, wardrobes, props, scenery, or special effects. The sales and use tax does not apply to a sale of tangible personal property, a digital code, a digital product, or a taxable service used directly in connection with a film production activity by a film producer or production company certified by the Department of Commerce under Title 6, Subtitle 2 of the Economic Development Article.

In this section, “accessory items” includes jewelry, watches, watchbands, handbags, handkerchiefs, umbrellas, scarves, ties, headbands, and belt buckles. Beginning in calendar year 2010, the 7–day period from the second Sunday in August through the following Saturday shall be a tax–free period for back–to–school shopping in Maryland during which the exemption under paragraph (2) of this subsection shall apply. During the tax–free period for back–to–school shopping established under paragraph (1) of this subsection, the sales and use tax does not apply to: the sale of any item of clothing or footwear, excluding accessory items, if the taxable price of the item of clothing or footwear is $100 or less; or the first $40 of the taxable price of any backpack or bookbag.

The sales and use tax does not apply to a sale of electricity, fuel, and other utilities used to operate the machinery or equipment used to produce snow for commercial purposes.

In this section the following words have the meanings indicated. “Geothermal equipment” means equipment that uses ground loop technology to heat and cool a structure. “Residential wind energy equipment” means equipment installed on residential property that uses wind energy to generate electricity to be used in a residential structure on the property. “Solar energy equipment” means equipment that uses solar energy to heat or cool a structure, generate electricity to be used in a structure or supplied to the electric grid, or provide hot water for use in a structure. “Solar energy equipment” does not include equipment that is part of a nonsolar energy system or that uses any type of recreational facility or equipment as a storage medium. The sales and use tax does not apply to a sale of geothermal equipment, residential wind energy equipment, or solar energy equipment.

The sales and use tax does not apply to the sale of a right to occupy a room or lodgings as a transient guest at a dormitory or other lodging facility that: is operated solely in support of a corporate or any other headquarters, training, conference, or awards facility or campus; provides lodging solely for employees, contractors, vendors, and other invitees of the corporation that owns the dormitory or lodging facility; and does not offer lodging services to the general public.

The sales and use tax does not apply to a sale of a light rail transit vehicle or related equipment if the vehicle will be used to provide transit service on the Purple Line in Montgomery County and Prince George’s County.

The sales and use tax does not apply to the cleaning of a commercial or industrial building if the building is owned by a common ownership community or retirement community and used for: classrooms; dining; exercise; food preparation or cooking; meetings or gatherings; offices used by the common ownership community for management of the community; recreation; security; sports; storage; or any other common use. The exemption under subsection (a) of this section does not apply to the cleaning of a commercial or industrial building or the proportionate share of the building that is used for a purpose that requires the collection of the sales and use tax under this title.

The sales and use tax does not apply to the sale of materials, parts, or equipment used to repair, maintain, or upgrade aircraft or the avionics systems of aircraft if the materials, parts, or equipment are installed on an aircraft that: has a maximum gross takeoff weight of less than 12,500 pounds; or has a maximum gross takeoff weight of 12,500 pounds or more; and is primarily used in interstate or foreign commerce.

In this section the following words have the meanings indicated. “Construction material” means an item of tangible personal property that is used to construct or renovate a building, a structure, or an improvement on land and that typically loses its separate identity as personal property once incorporated into the real property. “Construction material” includes building materials, building systems equipment, landscaping materials, and supplies. “Qualified opportunity zone” means any real property owned or leased by a person in Baltimore County that: as of January 1, 2020, was designated as: an enterprise zone under Title 5, Subtitle 7 of the Economic Development Article; and an opportunity zone under § 1400Z–1 of the Internal Revenue Code; and was previously owned at any time by the United States or its subsidiaries, successors, or assigns. “Target redevelopment area” means any real property owned or leased by a person in Washington County that: as of January 1, 2020, was designated as: an enterprise zone under Title 5, Subtitle 7 of the Economic Development Article; and was previously owned at any time by CSX Railroad or its subsidiaries, successors, or assigns; or was previously owned at any time by the United States or its subsidiaries, successors, or assigns. “Warehousing equipment” means equipment used for material handling and storage, including racking systems, conveying systems, and computer systems and equipment. The sales and use tax does not apply to a sale of construction material or warehousing equipment if: the material or equipment is purchased by a person solely for use in a qualified opportunity zone or target redevelopment area; and the buyer provides the vendor with evidence of eligibility for the exemption issued by the Comptroller.

In this section the following words have the meanings indicated. “Data center” means a building or group of buildings used to house computer systems, computer storage equipment, and associated infrastructure that businesses or other organizations use to organize, process, store, and disseminate large amounts of data. “Department” means the Department of Commerce. “Opportunity zone” means an area that has been designated as a qualified opportunity zone in the State under § 1400Z–1 of the Internal Revenue Code. “Qualified data center” means a data center located in the State in which an individual or a corporation, within 3 years after submitting an application for the sales and use tax exemption under this section, has: for a data center located within a Tier I area, invested at least $2,000,000 in qualified data center personal property and created at least five qualified positions; or for a data center located in any other area of the State, invested at least $5,000,000 in qualified data center personal property and created at least five qualified positions. “Qualified data center” includes: a data center that is a co–located or hosting data center where equipment, space, and bandwidth are available to lease to multiple customers; and an enterprise data center owned and operated by the company it supports. “Qualified data center personal property” means personal property purchased or leased to establish or operate a data center. “Qualified data center personal property” includes: computer equipment or enabling software used for the processing, storage, retrieval, or communication of data, including servers, routers, connections, and other enabling hardware used in the operation of that equipment; heating, ventilation, and air–conditioning and mechanical systems, including chillers, cooling towers, air–handling units, pumps, energy storage or energy efficiency technology, and other capital equipment used in the operation of that equipment; and equipment necessary for the generation, transformation, transmission, distribution, or management of electricity, including exterior substations, generators, transformers, unit substations, uninterruptible power supply systems, batteries, power distribution units, remote power panels, and any other capital equipment necessary for these purposes. “Qualified position” means a position that: is a full–time position of indefinite duration; pays at least 150% of the State minimum wage; is newly created because a data center begins or expands in a single location in the State; and is filled. “Qualified position” does not include a position: created if an employment function is shifted from an existing data center in the State to another data center of related ownership if the position is not a net new job in the State; created through a change in ownership of a trade or business; created through a consolidation, merger, or restructuring of a business entity if the position is not a net new job in the State; created if an employment function is contractually shifted from an existing business entity in the State to another business entity if the position is not a net new job in the State; or filled for a period of less than 12 months. “Tier I area” means: a Tier I county as defined in § 1–101 of the Economic Development Article; or an opportunity zone. The sales and use tax does not apply to the sale of qualified data center personal property for use at a qualified data center if the buyer provides the vendor with evidence of eligibility for the exemption issued by the Comptroller. To qualify for the sales and use tax exemption under subsection (b) of this section, an individual or a corporation shall file an application for an exemption certificate with the Department. The application must: demonstrate that the applicant intends to meet the requirements of a qualified data center; and include any information the Department requires to evidence the capacity and intention of the applicant to fulfill the commitments set forth in the applicant’s application. If, based on the information and supporting documentation provided in the application, the Department determines the applicant is eligible for the sales and use tax exemption under subsection (b) of this section, the Department shall certify the eligibility of the applicant. Each year, the Department shall provide the Comptroller with a list of individuals and corporations that the Department determines are eligible for the sales and use tax exemption under subsection (b) of this section. Within 30 days after receiving the list described in paragraph (1) of this subsection, the Comptroller shall issue to each individual and corporation listed a certificate of eligibility for the sales and use tax exemption under subsection (b) of this section. The certificate of eligibility issued under paragraph (2) of this subsection: must be renewed each year; and except as provided in subparagraph (ii) of this paragraph, may not be renewed for more than 10 consecutive years. If the individual or corporation invests at least $250,000,000 in qualified data center personal property, the certificate of eligibility may be renewed for up to 20 consecutive years. For at least 3 years after the termination of a certificate issued under subsection (d) of this section, each individual or corporation that receives the certificate shall: maintain a record of: the amount of sales and use tax that was not paid as a result of the certificate; the number of qualified positions created; and the investment in qualified data center personal property; and allow the Department to inspect the records described in item (1) of this subsection. The Department may revoke a certificate of eligibility under subsection (d) of this section if any representation made in connection with the application for the certificate is determined by the Department to have been false when made or if the applicant has failed to fulfill the applicant’s commitments under the application. The revocation may be in full or in part as the Department may determine. The individual or corporation shall have an opportunity to appeal any revocation to the Department before notification of the Comptroller. The Comptroller may make an assessment against the individual or corporation to recapture any amount of sales and use tax that the individual or corporation has not paid as a result of an exemption under subsection (b) of this section.

In this section: “licensed caterer” means the holder of a food service facility license issued by a county that offers catering services in connection with a specific event; and “licensed caterer” does not include a food service facility that is primarily engaged in the preparation and service of food to the general public at the facility. The sales and use tax does not apply to the sale of materials, equipment, or supplies to a licensed caterer if the materials, equipment, or supplies are: to be used by the caterer to perform a contract for catering services; and intended for resale by the caterer; and to be used directly or predominantly by the caterer in performing a catering contract that includes the provision of food and beverages.

In this section the following words have the meanings indicated. “Construction material” means an item of tangible personal property that: is used to construct or renovate: a building; a structure; an improvement on land; or infrastructure, including water, sewer, and other utility systems; and typically loses its separate identity as personal property once incorporated into the real property. “Construction material” includes building materials, building systems equipment, landscaping materials, and supplies. “Federal facilities redevelopment area” means any real property in Cecil County that: was previously owned at any time by the federal government; was transferred from the federal government to the State or to an entity established under Title 11, Subtitle 4 of the Economic Development Article; and is entirely under the environmental oversight and management of: the State Hazardous Substance Response Plan under Title 7, Subtitle 2 of the Environment Article; or the Voluntary Cleanup Program under Title 7, Subtitle 5 of the Environment Article. “Warehousing equipment” means equipment used for material handling and storage, including racking systems, conveying systems, and computer systems and equipment. The sales and use tax does not apply to a sale of construction material or warehousing equipment if: the material or equipment is purchased by a person solely for use in a federal facilities redevelopment area; and the buyer provides the vendor with evidence of eligibility for the exemption issued by the Comptroller.

In this section the following words have the meanings indicated. “Construction material” means an item of tangible personal property that is used to construct or renovate a building, a structure, or an improvement on land and that typically loses its separate identity as personal property once incorporated into the real property. “Construction material” includes building materials, building systems equipment, landscaping materials, and supplies. “Hagerstown Multi–Use Sports and Events Facility” has the meaning stated in § 10–601 of the Economic Development Article. “Prince George’s County Blue Line Corridor facility” has the meaning stated in § 10–601 of the Economic Development Article. “Sports entertainment facility” has the meaning stated in § 10–601 of the Economic Development Article. The sales and use tax does not apply to a sale of construction material if: the construction material is purchased by a person solely for use in furtherance of the provisions of Title 10, Subtitle 6 of the Economic Development Article for the construction or redevelopment of: the Hagerstown Multi–Use Sports and Events Facility that is managed by the Maryland Stadium Authority; a sports entertainment facility; or a Prince George’s County Blue Line Corridor facility; the sale is made on or after October 1, 2021; and the buyer provides the vendor with evidence of eligibility for the exemption issued by the Comptroller. The Comptroller shall adopt regulations to implement this section.

The sales and use tax does not apply to a sale of an infant car seat.

The sales and use tax does not apply to the sale of: medical cannabis under Title 36 of the Alcoholic Beverages and Cannabis Article; cannabis between cannabis businesses that are licensed under Title 36 of the Alcoholic Beverages and Cannabis Article; or cannabis between a cannabis business licensed under Title 36 of the Alcoholic Beverages and Cannabis Article and a cannabis nursery registered under Title 36 of the Alcoholic Beverages and Cannabis Article.

In this section the following words have the meanings indicated. “Emerging technology development area” means the University of Maryland’s Discovery District located in Prince George’s County. “Qualified company” means a company that contracts with the University of Maryland’s Applied Research Laboratory for Intelligence and Security to develop systems and technologies to advance the use of quantum computers. The sales and use tax imposed on a taxable service described under § 11–101(m)(14) or (15) of this title does not apply to a sale: to a qualified company located in an emerging technology development area made in connection with the work of the company; or by a qualified company located in an emerging technology development area.

In this section, “affiliated group” has the meaning stated under § 1504 of the Internal Revenue Code and includes related parties described under § 267(b)(10), (11), or (12) of the Internal Revenue Code. For the purposes of this subsection: all references to a corporation or partnership under § 267(b)(10) of the Internal Revenue Code include an S corporation; and all references to an S corporation under § 267(b)(10), (11), and (12) of the Internal Revenue Code include a qualified Subchapter S corporation subsidiary. The sales and use tax imposed on a taxable service described under § 11–101(m)(14) or (15) of this title or a digital code or digital product does not apply to a sale if both the vendor and the buyer are members of the same affiliated group.

In this section the following words have the meanings indicated. “Construction material” means an item of tangible personal property that is used to construct or renovate a building, a structure, or an improvement on land and that typically loses its separate identity as personal property once incorporated into the real property. “Construction material” includes building materials, building systems equipment, landscaping materials, and supplies. “Target redevelopment area” means real property in Washington County that: is commonly known as the Mount Aetna Technology Park and accessible from Robinwood Drive, Mount Aetna Road, and Yale Drive; and is located in an Office, Research, and Industry zoning district. “Warehousing equipment” means equipment used for material handling and storage, including racking systems, conveying systems, and computer systems and equipment. The sales and use tax does not apply to a sale of construction material or warehousing equipment if: the material or equipment is purchased by a person solely for use in a target redevelopment area; and the buyer provides the vendor with evidence of eligibility for the exemption issued by the Comptroller. For at least 3 years after the date of a sale described under subsection (b) of this section, the buyer shall maintain a record of the amount of sales and use tax that was not paid as a result of the exemption under this section. On or before October 1, 2027, and each October 1 thereafter, each buyer that receives a certificate issued in accordance with this section shall report to the Comptroller the amount of sales and use tax that was not paid as a result of the exemption under this section during the immediately preceding fiscal year. On or before December 31, 2027, and each December 31 thereafter, the Comptroller shall submit a report to the Governor and, in accordance with § 2–1257 of the State Government Article, the General Assembly on the aggregate amount of sales and use tax that was not paid as a result of the exemption under this section during the immediately preceding fiscal year.