On July 1, 2022, Maryland changed the definition of a digital product to make application of sales and use tax exclude certain products. The products that are now excluded are those where the purchaser has certain property interest and certain types of computer software. Digital products no longer include the following additions:
– “A product having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities where the purchaser holds a copyright or other intellectual property interest in the product, in the whole or in part, if the purchaser uses the product solely for commercial purposes, including advertising or other marketing activities
– Computer software or software as a service purchased or licensed solely for commercial purposes in an enterprise computer system, including operating programs or application software for the exclusive use of the enterprise software system that is housed for maintained by the purchaser or on a cloud server, whether hosted by the purchaser, the software vendor, or a third party”
(Maryland General Assembly, enacted under Article II, Section 17(c) of the Maryland Constitution – Chapter 535)