Sales contracts entered into prior to January 3, 2008 are taxable at a 5 percent rate. The sales tax applies and must be collected and remitted at the time a sale is made, regardless of the time of payment of the price or time of delivery.
If the sale is made by a vendor located outside of the state of Maryland who is not required to collect the Maryland tax, the use tax is due at the 6 percent rate when possession is taken in Maryland after January 2, 2008. Proper records must be maintained regarding the date and terms of a sale in order to justify collecting at the 5 percent rate where delivery or payment is made after January 2, 2008.
The tax rate due on applicable lease payments for tangible personal property is based on the lease payment period, regardless of the length of the lease or the date that the lease agreement was signed. Each lease payment period is considered to be a separate lease for sales and use tax purposes. Payments for lease periods due after January 3, 2008 will be subject to tax at the 6 percent rate.