The U.S. Court of Appeals for the Fourth Circuit ruled that a Maryland digital advertising tax law's provision, which barred companies from disclosing the tax charge on bills, violated the First Amendment. The court emphasized the importance of transparent communication regarding taxation in a democratic society, pointing out that Maryland's law aimed to prevent criticism of the tax. This law affects large tech companies with significant global revenue, specifically targeting those earning at least $100 million annually. The ruling underscores the critical role of freedom of speech in public discourse related to taxation.
The U.S. Court of Appeals for the Fourth Circuit held the tax speech ban violated the First Amendment. Companies that make money advertising on the internet must not only pay the tax but avoid telling their customers how it affects pricing.
The Maryland law imposes a tax of up to 10% of global revenue on large tech companies such as Amazon, Google and Facebook and applies only to those that generate at least $100 million in global annual gross revenues.
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