Budget & Taxes (Business Taxes)

SB 987 modifies Maryland's corporate income tax to allow pharmaceutical companies to deduct certain direct-to-consumer advertising expenses for covered drugs. It directly affects pharmaceutical manufacturers that advertise prescription drugs directly to the public via TV, radio, social media, or digital platforms (excluding journal ads). The bill creates a new tax deduction for these advertising costs, with revenue from this modification distributed as follows: the first $5 million annually to Medicaid eligibility operations, and remaining funds to health insurance subsidy programs. This change aligns Maryland's tax treatment with federal rules while directing revenue toward health coverage affordability.

HB 983 modifies Maryland's tax credit programs and exemptions. It terminates the Enterprise Zone Program and the One Maryland Economic Development Tax Credit Program on specific dates, ending eligibility for related tax benefits. The bill also limits annual claims for enterprise zone tax credits, restricts carryforwards for film production tax credits, and repeals sales tax exemptions for concrete, telecom equipment, and construction materials. Additionally, it alters eligibility rules for certain vehicle tax credits and ends property tax credits tied to enterprise zones.

HB 690, the "Economic Competitiveness Act of 2026," lowers Maryland's corporate income tax rate gradually over several years. It directly affects corporations doing business in Maryland that pay state corporate income tax. The bill reduces the rate from 8.25% (for tax years 2026-2027) to 7.75% (2027-2028), then to 7.25% (2028-2029), 6.75% (2029-2030), and finally to 6.25% starting in 2030. The changes take effect July 1, 2026, as specified in the bill's provisions.