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EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
Italics indicate opposite chamber/conference committee amendments.
*hb1026*
HOUSE BILL 1026
C2, K3 EMERGENCY BILL (6lr2934)
ENROLLED BILL
— Economic Matters/Finance —
Introduced by Delegate Queen
Read and Examined by Proofreaders:
_______________________________________________
Proofreader.
_______________________________________________
Proofreader.
Sealed with the Great Seal and presented to the Governor, for his approval this
_______ day of _______________ at _________________ _______ o’clock, ________M.
______________________________________________
Speaker.
CHAPTER ______
AN ACT concerning 1
Business Regulation – Rounding Cash Transactions – Authorization 2
FOR the purpose of authorizing a merchant to round the portion of the price of a certain 3
cash transactions transaction for which a customer pays using cash in a certain 4
manner or round the amount of change due to a customer in a certain manner; 5
authorizing an employer to round a wage that the employer pays using cash in a 6
certain manner providing that a certain amount added to or subtracted from the price 7
in a cash transaction under this Act is not included in the taxable price ; providing 8
that certain provisions of this Act shall preempt existing regulations, rules, an d 9
ordinances that conflict with certain provisions of this Act; altering the definition of 10
“taxable price” for the purposes of certain provisions of law governing the State sales 11
and use tax to clarify the exclusion from the tax of a certain amount collect ed due to 12
rounding the price for a good or service in accordance with certain provisions of this 13
Act; and generally relating to rounding cash transactions. 14
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BY adding to 1
Article – Business Regulation 2
Section 1 –601 through 1–607 1–606 to be under the new subtitle “Subtitle 6. 3
Rounding Cash Transactions in a Trade or Business” 4
Annotated Code of Maryland 5
(2024 Replacement Volume and 2025 Supplement) 6
BY repealing and reenacting, without amendments, 7
Article – Labor and Employment 8
Section 3–502(a) 9
Annotated Code of Maryland 10
(2025 Replacement Volume) 11
BY adding to 12
Article – Labor and Employment 13
Section 3–502(g) 14
Annotated Code of Maryland 15
(2025 Replacement Volume) 16
BY repealing and reenacting, without amendments, 17
Article – Tax – General 18
Section 11–101(a) and (l)(1) 19
Annotated Code of Maryland 20
(2022 Replacement Volume and 2025 Supplement) 21
BY repealing and reenacting, with amendments, 22
Article – Tax – General 23
Section 11–101(l) 11–101(l)(3) 24
Annotated Code of Maryland 25
(2022 Replacement Volume and 2025 Supplement) 26
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 27
That the Laws of Maryland read as follows: 28
Article – Business Regulation 29
SUBTITLE 6. ROUNDING CASH TRANSACTIONS IN A TRADE OR BUSINESS. 30
1–601. 31
(A) IN THIS SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS 32
INDICATED. 33
(B) (1) “CASH” MEANS UNITED STATES COINS AND CURRENCY. 34
(2) “CASH” DOES NOT INCLUDE: 35
HOUSE BILL 1026 3
(I) A PAPER INSTRUMENT O THER THAN A FEDERAL RESERVE 1
NOTE; OR 2
(II) A GIFT CARD. 3
(C) “CUSTOMER” MEANS A PURCHASER OF A GOOD OR SERVICE FROM A 4
MERCHANT. 5
(D) “MERCHANT” MEANS A PERSON ENGAGED IN THE TRADE OR B USINESS 6
OF THE SALE OF GOODS OR SERVICES. 7
(E) “TOTAL PRICE PRICE” MEANS THE PRICE AMOUNT DUE AND PAYAB LE 8
BY A CUSTOMER IS RESPONSIBLE FOR P AYING FOR A GOOD OR SERVICE AFTER A 9
MERCHANT: 10
(1) SUBTRACTS ANY DISCOUNT OR DEDUCTION; AND 11
(2) APPLIES ANY APPLICABLE TAX OR FEE; AND 12
(3) ROUNDS THE TRANSACTION CONSISTENT WITH THIS SUBTITLE. 13
1–602. 14
THIS SUBTITLE: 15
(1) DOES NOT APPLY TO A CASH TRANSACTION FOR A GO OD OR 16
SERVICE IN EXCHANGE FOR PAID WITH EXACT CHANGE; AND 17
(2) MAY NOT BE CONSTRUED TO AUTHORIZE A MERCHANT TO ROUND 18
A PRICE FOR A GOOD OR SERVICE IN A MANNER THAT ALTERS THE CALCULATION OF 19
ANY TAX OR FEE APPLICABLE TO THE TRANSACTION. 20
1–603. 21
(A) THIS SECTION APPLIES TO: 22
(1) THE PORTION OF THE P RICE OF AN IN –PERSON, CASH 23
TRANSACTION IF THE PRICE TOTALS AT LEAST 5 CENTS; OR 24
(2) OR A TELEPHONE, MAIL, OR INTERNET TRANSACTION FOR WHICH 25
A CUSTOMER PAYS USING CASH IF THE PRICE TOTALS AT LEAST 5 CENTS. 26
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(B) NOTWITHSTANDING ANY O THER PROVISION OF LA W, A MERCHANT 1
DOING BUSINESS IN THE STATE MAY: 2
(1) DETERMINE THE TOTAL PRICE OF ROUND THE PRICE FOR A GOOD 3
OR SERVICE, AFTER SUBTRACTING ANY DISCOUNT OR DEDUCTION FROM THE PRICE 4
AND APPLYING ANY APP LICABLE TAX OR FEE T O THE PRICE , IN THE FOLLOWING 5
MANNER: 6
(I) IF THE PRICE ENDS IN 1 CENT, 2 CENTS, 6 CENTS, OR 7 7
CENTS, BY ROUNDING THE PRICE DOWN TO THE NEAREST CENT DIVISIBLE BY FIVE; 8
OR 9
(II) IF THE PRICE ENDS IN 3 CENTS, 4 CENTS, 8 CENTS, OR 9 10
CENTS, BY ROUNDING THE PRICE UP TO THE NEAREST CENT DIVISIBLE BY FIVE; OR 11
(2) ROUND THE AMOUNT OF CHANGE DUE TO A CUST OMER UP OR 12
DOWN CONSISTENT WITH ITEM (1) OF THIS SUBSECTION. 13
1–604. 14
(A) THIS SECTION APPLIES TO: 15
(1) THE PORTION OF THE PRICE OF AN IN –PERSON, CASH 16
TRANSACTION IF THE PRICE TOTALS LESS THAN 5 CENTS; OR 17
(2) OR A TELEPHONE, MAIL, OR INTERNET TRANSACTION FOR WHICH 18
A PERSON CUSTOMER PAYS USING CASH IF THE PRICE TOTALS LESS THAN 5 CENTS. 19
(B) NOTWITHSTANDING A NY OTHER PROVISION O F LAW , A MERCHANT 20
DOING BUSINESS IN THE STATE MAY DETERMINE THE TOTAL PRICE OF ROUND THE 21
PRICE FOR A GOOD OR SERVICE , AFTER SUBTRACTING AN Y DISCOUNT OR 22
DEDUCTION FROM THE PRICE AND APPLYING ANY APPLICABLE TAX OR FEE TO THE 23
PRICE, BY ROUNDING THE PRICE UP TO 5 CENTS. 24
1–605. 25
AN EMPLOYER , AS DEFINED IN § 3–501 OF THE LABOR AND EMPLOYMENT 26
ARTICLE, MAY ROUND A WAGE , AS DEFINED IN § 3–501 OF THE LABOR AND 27
EMPLOYMENT ARTICLE, THAT THE EMPLOYER PAYS USING CASH CONSISTENT WITH 28
THIS SUBTITLE. 29
1–606. 1–605. 30
HOUSE BILL 1026 5
THIS SUBTITLE SUPERSEDES ANY REGULATION, RULE, OR ORDINANCE THAT 1
CONFLICTS WITH THIS SUBTITLE. 2
1–607. 1–606. 3
THE SECRETARY MAY ADOPT REGULATIONS TO CARRY OUT THE PROVISIONS 4
OF THIS SUBTITLE. 5
Article – Labor and Employment 6
3–502. 7
(a) (1) Each employer: 8
(i) shall set regular pay periods; and 9
(ii) except as provided in paragraph (2) of this subsection, shall pay 10
each employee at least once in every 2 weeks or twice in each month. 11
(2) An employer may pay an administrative, executive, or professional 12
employee less frequently than required under paragraph (1)(ii) of this subsection. 13
(G) AN EMPLOYER MAY ROUND A WAGE THAT THE EMPL OYER PAYS USING 14
CASH, AS DEFINED IN § 1–601 OF THE BUSINESS REGULATION ARTICLE, 15
CONSISTENT WITH TITLE 1, SUBTITLE 6 OF THE BUSINESS REGULATION ARTICLE. 16
Article – Tax – General 17
11–101. 18
(a) In this title the following words have the meanings indicated. 19
(l) (1) “Taxable price” means the value, in money, of the consideration of any 20
kind that is paid, delivered, payable, or deliverable by a buyer to a vendor in the 21
consummation and complete performance of a sale without deduction for any expense or cost, 22
including the cost of: 23
(i) any labor or service rendered; 24
(ii) any material used; or 25
(iii) any property, digital code, or digital product sold. 26
(2) “Taxable price” includes, for tangible personal property, a digital code, 27
or a digital product acquired by a sale for use in the State by the person who assembles, 28
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fabricates, or manufactures the property or digital product, only the price of the raw 1
materials and component parts contained in the property or digital product. 2
(3) “Taxable price” does not include: 3
(i) a charge that is made in connection with a sale and is stated as a 4
separate item of the consideration for: 5
1. a delivery, freight, or other transportation service for 6
delivery directly to the buyer by the vendor or by another person acting for the vendor, unless 7
the transportation service is a taxable service; 8
2. a finance charge, interest, or similar charge for credit 9
extended to the buyer; 10
3. a labor or service for application or installation; 11
4. a mandatory gratuity or service charge in the nature of a 12
tip for serving food or beverage to a group of 10 or fewer individuals for consumption on the 13
premises of the vendor; 14
5. a professional service; 15
6. a tax: 16
A. imposed by a county on the sale of coal, electricity, oil, 17
nuclear fuel assemblies, steam, or artificial or natural gas; 18
B. imposed under § 3–302(a) of the Natural Resources Article, 19
as a surcharge on electricity, and added to an electric bill; 20
C. imposed under §§ 6 –201 through 6 –203 of the Tax – 21
Property Article, on tangible personal property subject to a lease that is for an initial period 22
that exceeds 1 year and is noncancellable except for cause; or 23
D. imposed under § 4–102 of this article on the gross receipts 24
derived from an admissions and amusement charge; 25
7. any service for the operation of equipment used for th e 26
production of audio, video, or film recordings; or 27
8. reimbursement of incidental expenses paid to a third party 28
and incurred in connection with providing a taxable detective service; 29
(ii) the value of a used component or part (core value) received from a 30
purchaser of the following remanufactured truck parts: 31
HOUSE BILL 1026 7
1. an air brake system; 1
2. an engine; 2
3. a rear axle carrier; or 3
4. a transmission; 4
(iii) a charge for a nontaxable service that is made in connection with 5
a sale of a taxable communication service, even if the nontaxable charges are aggregated 6
with and not separately stated from the taxable charges for communications services, if the 7
vendor can reasonably identify charges not subject to tax from its books and records that are 8
kept in the regular course of business; [or] 9
(iv) a transportation network company impact fee imposed under § 10
10–408 of the Public Utilities Article; OR 11
(V) AN AMOUNT LESS THAN 5 NOT EXCEEDING 2 CENTS ADDED 12
OR SUBTRACTED IN A C ASH TRANSACTION TO D ETERMINE THE ROUNDED PRICE 13
UNDER COLLECTED DUE TO ROU NDING THE PRICE FOR A GOOD OR SERVICE IN 14
ACCORDANCE WITH TITLE 1, SUBTITLE 6 OF THE BUSINESS REGULATION ARTICLE. 15
(4) “Taxable price” includes all sales and charges, including insurance, 16
freight handling, equipment and supplies, delivery and pickup, cellular telephone, and other 17
accessories, but not including sales of motor fuel subject to the motor fuel tax, made in 18
connection with: 19
(i) a short –term vehicle rental, as defined in § 11 –104(c) of this 20
subtitle; or 21
(ii) a shared motor vehicle used for peer –to–peer car sharing and 22
made available on a peer –to–peer car sharing program, as defined in § 19 –520 of the 23
Insurance Article. 24
(5) “Taxable price” includes: 25
(i) for the sale or use of an accommodation facilitated by an 26
accommodations intermediary or a short –term rental platform, the full amount of the 27
consideration paid by a buyer for the sale or use of a n accommodation, but not including 28
any tax that is remitted to a taxing authority; and 29
(ii) for the sale or use of a home amenity rental facilitated by a home 30
amenity rental intermediary or home amenity rental platform, the full amount of 31
consideration paid by a buyer for the sale or use of a home amenity rental, but not including 32
any tax that is remitted to a taxing authority. 33
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(6) “Taxable price” does not include: 1
(i) for the sale or use of an accommodation facilitated by an 2
accommodations intermediary or a short –term rental platform, a commission paid by an 3
accommodations provider to a person after facilitating the sale or use of an accommodation; 4
or 5
(ii) for the sale or use of a home amenity rental facilitated by a home 6
amenity rental intermediary or home amenity rental platform, a commission paid by a home 7
amenity rental provider to a person after facilitating the sale or use of a home amenity rental. 8
SECTION 2. AND BE IT FURTHER ENACTED, That this Act is an emergency 9
measure, is nec essary for the immediate preservation of the public health or safety, has 10
been passed by a yea and nay vote supported by three –fifths of all the members elected to 11
each of the two Houses of the General Assembly, and shall take effect from the date it is 12
enacted. 13
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.