State Finance and Procurement - Prevailing Wage Rate - Calculation
HB 997 would expand local admissions and amusement tax authority to allow counties and municipal corporations to tax certain gross receipts from the sale of food and beverages at places that have on-premises facilities for consumption. The bill defines “food or beverages” broadly to include food, alcoholic beverages, soft drinks, carbonated beverages, bottled water, candy, and confectionery, and it adds these sales to the list of taxable admissions-and-amusement receipts under local law.
The bill also creates limits and exclusions. Local governments could set a tax rate on these food and beverage sales, but that rate could not exceed 3 percent. At the same time, the bill expressly prohibits the admissions and amusement tax on several categories of sales, including off-premises alcohol, off-premises food or beverages sold by a substantial grocery or market business at the same location, and food or beverages sold through vending machines. It also clarifies that the existing combined local admissions-and-amusement/sales-tax cap does not apply to the new food and beverage tax rate.
In practical terms, the bill would amend Maryland’s Tax-General Article to broaden the base of the admissions and amusement tax for local governments while carving out specific exemptions. Counties and municipalities would gain a new revenue option, and businesses that sell prepared food and drinks for on-site consumption would be the primary affected parties. Grocery stores, off-premises alcohol sellers, and vending machine operators would be excluded from the new tax in the circumstances described.
The available context shows no committee debate or recorded votes, and the bill was ultimately withdrawn by the sponsor in the House. As a result, there is no documented floor or committee sentiment to assess from the provided materials. Based on the text alone, the measure appears to be a targeted local tax expansion with built-in limits, suggesting a policy balance between revenue generation and protection for certain retail sales categories.
Notable points of contention likely would have centered on the scope of the new tax base and the 3 percent cap. Businesses selling prepared food and beverages for on-site consumption would likely oppose the added local tax burden, while local governments may support the added revenue authority. The exemptions for grocery/market businesses, off-premises alcohol, and vending machine sales suggest an effort to narrow the reach of the tax and reduce opposition from retail and food-service stakeholders.
HB 997 would amend Maryland’s Tax-General Article to authorize counties and municipal corporations to impose admissions and amusement tax on gross receipts from certain food and beverage sales at locations with on-premises consumption facilities. It would also add a new statutory definition of “food or beverages,” create explicit exclusions for off-premises alcohol, certain grocery/market sales, and vending machine sales, and cap the local tax rate on these sales at 3 percent. The bill further clarifies that the general combined local tax cap with sales and use tax does not apply to this new food-and-beverage tax rate.
No committee transcripts or votes were provided, and the bill was withdrawn by the sponsor in the House, so there is no recorded legislative sentiment to summarize from debate or roll call. The bill’s structure suggests a pragmatic but potentially controversial local revenue measure: it expands taxing authority while limiting the rate and excluding several categories of sales. That combination indicates an attempt to balance local fiscal interests with concerns from affected businesses and consumers.
The main likely point of contention is whether counties and municipalities should be allowed to tax food and beverage sales under the admissions and amusement tax at all, especially for prepared food and drinks sold for on-premises consumption. Restaurants, entertainment venues, and similar businesses would likely view the measure as a new local tax burden, while local governments may support it as a revenue tool. Additional friction may arise over the bill’s exemptions and distinctions—particularly the carve-outs for grocery/market businesses, off-premises alcohol, and vending machines—which could be seen as either necessary limits or uneven treatment among sellers.