Washington – The Computer & Communications Industry Association filed a reply brief today at the U.S. Court of Appeals for the Fourth Circuit in its case challenging the Maryland Digital Advertising Gross Revenues Tax Act as an unconstitutional restriction of protected speech. This tax, assessed as 2.5% to 10% of global annual revenues, includes a restriction on how businesses may communicate to consumers about the tax, which the lower court acknowledged is speech protected by the First Amendment.
The brief, joined by the U.S. Chamber of Commerce and NetChoice, explains that, contrary to the lower court’s conclusory analysis, this constitutional challenge meets the Supreme Court’s standard for pre-enforcement lawsuits against state statutes. It also demonstrates that the Act violates the First Amendment by prohibiting businesses from stating that the tax has forced them to raise prices.
The Computer & Communications Industry Association and a coalition of trade associations has previously joined in filing a federal complaint challenging the constitutionality of this type of digital tax.
The following can be attributed to CCIA Senior Vice President and head of the CCIA Litigation Center Stephanie Joyce:
“American businesses are entitled by the First Amendment to speak freely with their clients about the effects that a law might have on their products, operations, and prices. This Maryland law attempts to bar businesses from telling the truth about what this tax means for consumer prices. This kind of statutory muzzle has been rejected by the courts as an unconstitutional infringement of speech.”
