Little-known Maryland tax applies to online shopping

WASHINGTON – Bargain hunters are getting ready for Cyber Monday, the online shopping version of Black Friday.

But some shoppers may be unintentionally breaking the law when they make online purchases.

A law in Maryland called the “use tax” requires consumers to pay a 6 percent fee on their online purchases. Bethesda Patch reports that shoppers are supposed to pay this additional tax outside of what is levied by an online seller.

The tax applies even when residents cross the border into Delaware, which doesn’t have a sales tax. But hardly anybody knows about the tax.

State Comptroller Peter Franchot points out that tax collection is a state government responsibility. He does not blame consumers for not paying it.

Maryland state officials also concede that few people know about the law. Patch reports that more than 95 percent of Marylanders don’t pay it.

Under the law, state residents have four deadlines within a year to pay the tax.

Franchot estimates that the state is losing $200 million a year in tax revenue. But he says without a sensible compliance program to collect the tax, it is the state’s fault, not the consumers’, that the tax revenue is lost.

WTOP’s Dick Uliano contributed to this report. Follow @WTOP on Twitter.

(Copyright 2012 by WTOP. All Rights Reserved.)

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