Maryland ’ – Maryland’s advertising tax is here and

Maryland’s advertising tax is here, and advertisers should look to their European counterparts to find out how to deal with it. Google imposed digital services taxes on advertisers in the U.K. Turkey and Austria last year, and Google is likely to do the same in the U.S. “Because the tax is levied on all services offered by multinational search and social media companies, it affects not only Google, but also Amazon, LinkedIn, Facebook and many others,” said Hagington, who advises companies to spread their advertising budgets across multiple platforms to reduce risk. But as we’ve seen in countries with similar taxes, the extra costs can end up going to companies advertising on those platforms, which in turn can pass them on to their customers. “This is another piece of spending that doesn’t go directly to the media,” says Azim Ahmad, director of digital marketing, who suggests that advertisers who have already planned their spending for the year withdraw a small percentage to see how their projections change. Evaluating the implementation of digital advertising taxes in those states and how advertisers in those regions have adapted to them can help prepare national advertisers should they be implemented in other U.S. states. Much work remains to be done when it comes to digital advertising taxes in the United States. If the tax fight in Maryland succeeds, it could slow the pace of similar legislation in other states. We contacted Facebook to see if they would impose a Maryland tax or other similar taxes at the state or federal level, but had not received a response at the time of publication. “It [the tax] seems to have forced advertisers who rely heavily on Google to perhaps diversify their channel lineup, as some say the lost tax percentage could be better spent on other channels,” Mr. Ahmad said. “That’s the cost of doing business,” “he” added. “Our clients have had to accept it as a cost of doing business, and while we’ve explained to them why these costs are added, in the end there’s nothing they can do about it and they just have to pay them,” said Andy Headington, managing director of Adido, a British digital marketing agency. Federal law also says that taxes on digital goods and services must also be applied to their physical equivalents, which could give those companies more grounds to challenge the tax. “Customers are usually the ones who bear these costs, and like other companies affected by this tax, we will be adding a fee to our bills starting in November,” a Google spokesman told The Guardian in September. Still, U.S. lawmakers are not the first to try to tax advertising platforms such as Google, Amazon, Facebook and Microsoft. Maryland’s tax applies to digital advertising revenue in the state and applies only to companies earning more than $100 million from digital advertising.