# Tax - General (GTG)

## Title 11. Sales and Use Tax

### Subtitle 4. Tax Collection

#### Section 11-401

(a) A vendor is a trustee for the State and is liable for the collection of the sales and use tax for and on account of the State.

(b) A vendor has the same rights to collect the sales and use tax from a buyer and the same rights regarding the nonpayment of the sales and use tax by a buyer that the vendor would have if the sales and use tax were a part of the purchase price of the tangible personal property, digital code, digital product, or taxable service at the time of the sale.

#### Section 11-402

Subject to Sec. 11-302 of this title, a vendor may:

(1) assume or absorb all or any part of the sales and use tax imposed on a retail sale or use; and

(2) pay that sales and use tax on behalf of the buyer.

#### Section 11-403

(a)

  (1) In this section the following words have the meanings indicated.

  (2) "Affiliated group" has the meaning stated under Sec. 1504 of the Internal Revenue Code and includes related parties described under Sec. 267(b)(10), (11), or (12) of the Internal Revenue Code.

  (3) "Pass-through entity" has the meaning stated in Sec. 10-102.1 of this article.

  (4) "Related pass-through entities" means one or more pass-through entities connected through ownership with a common parent pass-through entity but only if the common parent:

    (i) possesses at least 80% of the total voting power of the pass-through entity; and

    (ii) has a value equal to at least 80% of the total value of the pass-through entity.

  (5) "Sales" includes a booking transaction made through a short-term rental platform.

(b) Except as otherwise provided in this subtitle, a vendor shall collect the applicable sales and use tax from the buyer:

  (1) at the time that the sale is made, regardless of when the taxable price is paid;

  (2) if the tax is based on a credit or installment sale, at the time that the Comptroller requires by regulation; or

  (3) if a sale for use is not taxable when the sale is made, at the time that the use becomes taxable.

(c) Except as otherwise provided in this title, unless a buyer is otherwise required by regulation to pay the sales and use tax directly to the Comptroller, the buyer shall pay the sales and use tax to the vendor at the time required under subsection (b) of this section.

(d) A vendor shall refund to a buyer the proportionate amount of sales and use tax that the buyer has paid if:

  (1)

    (i) a sale is rescinded or canceled; or

    (ii) the property sold is returned to the vendor; and

  (2) the purchase price is wholly or partially repaid or credited.

(e)

  (1) A buyer may present to the vendor a certificate indicating multiple points of use of a digital code, digital product, or taxable service described under Sec. 11-101(m)(14) or (15) of this title, if:

    (i) the buyer knows at the time of purchase that the digital code, digital product, or taxable service described under Sec. 11-101(m)(14) or (15) of this title will be:

      (1) concurrently available for use by the buyer in more than one taxing jurisdiction; or

      (2) resold in its original form to a member of an affiliated group or a related pass-through entity of which the buyer is also a member; and

    (ii) the buyer delivers to the vendor the certificate indicating multiple points of use at the time of purchase.

  (2) On receipt of the fully completed certificate indicating multiple points of use, the vendor is relieved of the obligation to collect, pay, or remit the applicable tax to the Comptroller and, subject to paragraph (4) of this subsection, the buyer is obligated to collect, pay, or remit the applicable tax to the Comptroller.

  (3) The buyer delivering the certificate indicating multiple points of use may use any reasonable but consistent and uniform method of apportionment that is supported by the buyer's records as they exist at the time of the sale and accurately reflects the primary use location in the State.

  (4)

    (i) If the apportionment on the certificate indicating multiple points of use is determined based on a subsequent resale to one or more members of an affiliated group or related pass-through entities, the affiliated member or related pass-through entity reselling the digital code, digital product, or taxable service described under Sec. 11-101(m)(14) or (15) of this title to another affiliated member or related pass-through entity shall:

      (1) assume or absorb the sales and use tax due from the affiliated member or members or related pass-through entity or entities on that portion of the sale apportioned to the State and pay the sales and use tax due on behalf of the affiliated member or members or related pass-through entity or entities; or

      (2) be liable for the sales and use tax due from the affiliated member or members or related pass-through entity or entities if the sales and use tax due is not paid by the affiliated member or members or related pass-through entity or entities.

    (ii) If the sales and use tax is paid as provided in subparagraph (i) of this paragraph, the affiliated member end user or related pass-through entity end user is relieved of the obligation to pay or remit the applicable tax to the Comptroller.

  (5) Notwithstanding any other provision of this subsection, if the taxable price of a subsequent resale of a digital code, digital product, or taxable service described under Sec. 11-101(m)(14) or (15) of this title to an affiliated group member or related pass-through entity is higher than the taxable price on which the sales and use tax was paid, the end user shall be liable for the additional sales and use tax due on the difference in the taxable price.

  (6) The certificate indicating multiple points of use shall include all information required by the Comptroller.

#### Section 11-403.1

(a)

  (1) A marketplace facilitator shall collect the applicable sales and use tax due on a retail sale or sale for use by a marketplace seller to a buyer in this State.

  (2) A marketplace seller is not required to collect the applicable sales and use tax under paragraph (1) of this subsection to the extent that the marketplace facilitator collects the applicable sales and use tax.

(b) Except as otherwise provided in this title, unless a buyer is otherwise required by regulation to pay the sales and use tax directly to the Comptroller, the buyer shall pay the sales and use tax to the marketplace facilitator at the time of the taxable sale described under subsection (a) of this section.

(c) A marketplace facilitator, or other appropriate party, shall refund to a buyer the proportionate amount of sales and use tax that the buyer has paid if:

  (1)

    (i) a sale is rescinded or canceled; or

    (ii) the property sold is returned to the marketplace facilitator or marketplace seller; and

  (2) the purchase price is wholly or partially repaid or credited.

(d) A marketplace facilitator shall report the sales and use tax collected under this section separately from the sales and use tax collected by the marketplace facilitator on taxable sales made directly by the marketplace facilitator, or an affiliate of the marketplace facilitator, to buyers in this State.

(e)

  (1) A class action may not be brought against a marketplace facilitator in a court of this State on behalf of buyers arising from or in any way related to an overpayment of sales or use tax collected on sales facilitated by the marketplace facilitator, regardless of whether that claim is characterized as a tax refund claim.

  (2) Paragraph (1) of this subsection may not be construed to affect a buyer's right to seek a refund under subsection (c) of this section or Title 13, Subtitle 9 of this article.

(f)

  (1) This subsection does not apply if a marketplace facilitator and a marketplace seller are related entities.

  (2) A marketplace facilitator is not liable for a failure to collect the correct amount of sales and use tax due under this section if the marketplace facilitator demonstrates to the satisfaction of the Comptroller that the failure was the result of insufficient or incorrect information provided by the marketplace seller.

(g) Nothing in this section affects the obligation of a buyer to remit the applicable sales and use tax for any taxable sale for which a marketplace facilitator fails to collect and remit the applicable sales and use tax.

(h)

  (1) A marketplace facilitator and marketplace seller may apply to the Comptroller for a waiver of the collection requirement under this section if:

    (i) the marketplace seller is a communications company that is publicly traded or is controlled, directly or indirectly, by a company that is publicly traded;

    (ii) the marketplace facilitator and marketplace seller enter into an agreement that the marketplace seller will collect and remit all applicable sales and use taxes imposed under this title; and

    (iii) the marketplace seller provides evidence to the marketplace facilitator that the marketplace seller is licensed under Sec. 11-702 of this title to engage in the business of an out-of-state vendor in the State or a retail vendor in the State.

  (2) If the waiver under paragraph (1) of this subsection is authorized:

    (i) the marketplace seller subject to the agreement under paragraph (1) of this subsection shall collect and remit the sales and use tax imposed under this title;

    (ii) the marketplace facilitator is not required to collect or remit the sales and use tax imposed under this title; and

    (iii) the marketplace facilitator is not liable for the failure of a marketplace seller to collect and remit any sales and use tax imposed under this title.

  (3) The Comptroller shall adopt regulations that establish:

    (i) the criteria for obtaining a waiver under this subsection; and

    (ii) the process and procedure to apply for a waiver.

(i)

  (1) If the Comptroller conducts an audit for compliance with this section, the Comptroller may audit only the marketplace facilitator for sales made by a marketplace seller that are facilitated by the marketplace facilitator.

  (2) The Comptroller may not audit the marketplace seller for sales facilitated by the marketplace facilitator for which the marketplace facilitator collected or should have collected the sales and use tax due.

#### Section 11-404

The collection of the sales and use tax on a sale for use in the State is not affected even if:

(1) as a result of solicitation by the vendor in a catalog or other written advertisement, the order of the buyer or the contract of sale is delivered, mailed, or otherwise transmitted out of the State to the vendor;

(2) the order of the buyer or the contract of sale provides for tangible personal property obtained or manufactured out of the State to be shipped directly to the buyer from the point of origin;

(3) tangible personal property, intended to be brought into the State for use in the State, is delivered outside the State directly to the buyer;

(4) the order of the buyer or the contract of sale is made or closed:

  (i) by acceptance or approval out of the State; or

  (ii) before the tangible personal property enters the State; or

(5) whether transportation costs are paid by the vendor or the buyer, tangible personal property:

  (i) is mailed to a buyer in the State from outside the State; or

  (ii) is delivered outside the State to a carrier freight on board or otherwise and directed to the buyer in the State.

#### Section 11-405

A vendor who sells tangible personal property, a digital code, a digital product, or a taxable service through a vending or other self-service machine:

(1) shall pay the sales and use tax to the Comptroller; and

(2) may not collect the sales and use tax from the buyer as a separately stated item.

#### Section 11-406

(a)

  (1) If the nature of a vendor's business makes the collection of the sales and use tax at the time of a retail sale impracticable, the vendor may submit to the Comptroller an application for authority to prepay the tax.

  (2) If the Comptroller approves the application, the Comptroller may impose on the applicant any condition that is reasonable under the circumstances.

  (3) If the Comptroller denies an application or imposes a condition on the applicant, the Comptroller shall:

    (i) give the applicant notice of the action; and

    (ii) schedule a prompt hearing for review of the action.

  (4) An applicant may waive the hearing under paragraph (3) of this subsection.

(b) A vendor who obtains authority to prepay the tax under this section:

  (1) shall pay the sales and use tax to the Comptroller; and

  (2) may not collect the sales and use tax from the buyer as a separately stated item.

#### Section 11-407

(a)

  (1) Except as provided in subsection (c) of this section, on or after July 1, 1993, the Comptroller may not:

    (i) grant the authority to make direct payment, to the Comptroller, of sales and use tax due on purchases by a vendor; or

    (ii) issue permits evidencing such authority.

  (2) Notwithstanding the provisions of paragraph (1) of this subsection, the Comptroller may continue to administer direct payment permits issued to vendors before July 1, 1993.

  (3) The Comptroller may:

    (i) issue the permit subject to reasonable and necessary terms and conditions; and

    (ii) revoke the direct payment permit at any time for cause.

(b) A vendor who receives evidence that the buyer has a direct payment permit is discharged from:

  (1) the duty to collect the sales and use tax; and

  (2) the liability for the sales and use tax.

(c)

  (1)

    (i) The Comptroller may enter into an effective rate agreement with a vendor licensed under Subtitle 7 of this title to allow the vendor to compute its sales and use tax liability for purchases made by the vendor for a specific period using a predetermined agreed-upon effective rate, eliminating the need to determine the liability on a transaction-by-transaction basis.

    (ii) An effective rate agreement:

      (1) shall specify the types of records to be maintained by the vendor; and

      (2) may exclude specified types of purchases or purchases in excess of specified dollar amounts.

    (iii) The Comptroller may void an effective rate agreement entered into under this subsection if the vendor's operations significantly change during the term of the agreement.

  (2)

    (i) If the Comptroller enters into an effective rate agreement with a vendor under this subsection, the Comptroller may issue a direct payment permit authorizing the vendor to make direct payment, to the Comptroller, of the sales and use tax due on purchases by that vendor that are subject to the effective rate agreement.

    (ii) A direct payment permit issued under this paragraph remains in effect as long as the effective rate agreement is in effect.

#### Section 11-408

(a) If a buyer is required under Subtitle 2 of this title or by regulation to provide a vendor with evidence of an exemption, the vendor may not recognize the exemption unless the buyer, before the sale is consummated, provides the vendor with:

  (1) evidence that the buyer has an exemption certificate; or

  (2) the evidence that the Comptroller requires by regulation.

(b)

  (1) Except as provided in paragraph (3) of this subsection, the duty of a vendor to collect the sales and use tax from a buyer is waived if the buyer provides the vendor with a signed resale certificate that:

    (i) is in the form that the Comptroller requires by regulation;

    (ii) states the name and address of the buyer;

    (iii)

      (1) provides the Maryland sales and use tax registration number of the buyer; or

      (2) for the sale of an antique or used collectible, provides a sales and use tax registration number of another state and states that the buyer is an out-of-state vendor who does not engage in the business of an out-of-state vendor, as defined in Sec. 11-701 of this title; and

    (iv) contains a statement to the effect that the tangible personal property, digital code, digital product, or taxable service is bought for the purpose of resale.

  (2)

    (i) If a buyer provides a resale certificate with a sales and use tax registration number of another state as provided under paragraph (1)(iii)2 of this subsection, the buyer shall also provide a copy of a sales and use tax registration license issued to the buyer from that state.

    (ii) If a buyer is from a state without a sales and use tax, that buyer shall provide a copy of a trader's license from that state or a comparable type of identification.

  (3)

    (i) A vendor may not accept a resale certificate if the vendor knows or should know that the sale is not for the purpose of resale.

    (ii) A vendor may not accept a resale certificate for a cash, check, or credit card sale if:

      (1) the taxable price is less than $200; and

      (2) the tangible personal property, digital code, digital product, or taxable service is not delivered by the vendor directly to the buyer's retail place of business.

  (4) A vendor shall obtain a resale certificate from a buyer:

    (i) before the sale is consummated; or

    (ii) if the vendor receives a notice of the Comptroller's intent to assess sales and use tax for failure to obtain a proper resale certificate, within 60 days after the date on which the notice is mailed.

  (5) If the vendor fails to obtain the resale certificate as required, the Comptroller's assessment under paragraph (4)(ii) of this subsection is final.

(c) If the taxable price is less than $200 for a cash, check, or credit card sale or sale for use that is not a retail sale and the tangible personal property, digital code, digital product, or taxable service is not delivered by the vendor directly to the buyer's retail place of business:

  (1) the sales and use tax shall be paid when the sale is made or when the use becomes taxable; and

  (2) the buyer who pays the sales and use tax may file a claim for a refund with the Comptroller.

#### Section 11-409

Notwithstanding any other provisions of law, before a State agency issues a rebate or similar instrument or authorizes a rebate or similar instrument to be issued by a nongovernmental entity to reduce the cost of a retail sale of household appliances under a program to promote energy efficiency, the State agency or nongovernmental entity shall require the buyer of a household appliance to certify that:

(1) the household appliance was purchased at a retail sale in the State; or

(2) the buyer paid the applicable State sales and use tax.

#### Section 11-410

A marina that sells dyed diesel fuel, as defined in Sec. 11-104(h) of this title:

(1) shall pay the sales and use tax to the Comptroller; and

(2) may not collect the sales and use tax from the buyer as a separately stated item.

#### Section 11-411

(a)

  (1) In this section the following words have the meanings indicated.

  (2) "Business entity" has the meaning stated in Sec. 6-801 of the Economic Development Article.

  (3) "Department" means the Department of Commerce.

  (4) "Eligible project" has the meaning stated in Sec. 6-801 of the Economic Development Article.

  (5) "New business entity" has the meaning stated in Sec. 6-801 of the Economic Development Article.

  (6) "Program" means the More Jobs for Marylanders Program established under Title 6, Subtitle 8 of the Economic Development Article.

  (7) "Qualified business entity" means a new business entity operating an eligible project under Title 6, Subtitle 8 of the Economic Development Article if the business entity received a certificate under Sec. 6-805 of the Economic Development Article before June 1, 2022.

  (8) "Qualified personal property or services" means personal property or services purchased for use at an eligible project by a qualified business entity that is enrolled in the Program.

  (9) "Reserve Fund" means the More Jobs for Marylanders Sales and Use Tax Refund Reserve Fund established under this section.

(b) Except as provided in Sec. 6-805(b) of the Economic Development Article and subject to subsection (c) of this section, a qualified business entity is entitled to a refund for the amount of sales and use tax paid by the qualified business entity during the immediately preceding calendar year for a sale of qualified personal property or services made on or after January 1, 2018, if the qualified personal property or services are purchased by the qualified business entity solely for use at an eligible project while the project is enrolled in the Program.

(c) A qualified business entity may claim the refund authorized under subsection (b) of this section by:

  (1) on or after January 1 of the calendar year immediately following the purchase of the qualified personal property or services, filing a claim for refund with the Department; and

  (2) providing the Department any evidence that the Department requires by regulation.

(d)

  (1) There is a More Jobs for Marylanders Sales and Use Tax Refund Reserve Fund that is a special continuing, nonlapsing fund that is not subject to Sec. 7-302 of the State Finance and Procurement Article.

  (2) The money in the Reserve Fund shall be invested and reinvested by the State Treasurer, and interest and earnings shall be credited to the General Fund.

  (3) The Department shall issue a refund in an amount equal to the amount claimed by the qualified business entity under subsection (c) of this section.

  (4)

    (i) Except as otherwise provided in this paragraph, for any fiscal year, the Department may not issue sales and use tax refunds in amounts in the aggregate totaling more than $1,000,000 in a fiscal year.

    (ii) If the aggregate amount of sales and use tax refunds issued in a fiscal year totals less than the maximum provided under subparagraph (i) of this paragraph, any excess amount shall be transferred to the More Jobs for Marylanders Tax Credit Reserve Fund established under Sec. 10-741 of this article.

    (iii) For any fiscal year, if funds are transferred from the Reserve Fund under authority of any provision of law, the maximum amounts in the aggregate for which the Department may issue sales and use tax refunds shall be reduced by the amount transferred.

  (5) For fiscal year 2019 and each fiscal year thereafter, the Governor shall include in the annual budget bill an appropriation to the Reserve Fund.

  (6) Notwithstanding the provisions of Sec. 7-213 of the State Finance and Procurement Article, the Governor may not reduce an appropriation to the Reserve Fund in the State budget as approved by the General Assembly.

(e) The Department shall adopt regulations to carry out the provisions of this section and to specify criteria and procedures for the application for, approval of, and monitoring of continuing eligibility for sales and use tax refunds under this section.

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Md. Code Ann., Tax-Gen. (as displayed at mgaleg.maryland.gov, October 16, 2026)