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Committee backs switching telecom sales tax to $3.50-per-line excise to bolster school funding
Summary
The Government Operations and Fiscal Policy Committee voted 3-1-1 to move CB 18-2025 favorably; the bill would repeal the county telecommunications sales tax and replace it with an excise tax of up to $3.50 per line per month, a change OMB projects could raise roughly $51.6 million in the 2026 fiscal year.
The Government Operations and Fiscal Policy Committee voted to move CB 18-2025 favorably out of committee, a measure that would repeal Prince George’s County’s telecommunications sales tax and replace it with a per-line excise tax of up to $3.50 per line per month. The committee approved proposed technical amendments before advancing the bill; the final committee vote was 3 in favor, 1 opposed and 1 abstention.
The administration and county budget staff presented data showing years-long erosion of revenues from the county’s telecommunications sales tax. David Juppay of the Office of Management and Budget told the committee that telecommunications sales-tax receipts fell from roughly $44–$50 million in the program’s early years to about $13.5 million in 2024. He described the sales-tax mechanism as unstable and said a per-line excise used by other Maryland jurisdictions produces more predictable revenue.
"The current sales tax isn't working," Juppay told the committee, noting that Montgomery County and Baltimore City use flat excise structures that have produced more stable revenue. OMB's analysis, which the executive included in the FY2026 budget, assumes a $3.50 per line per month excise would yield about $51.6 million in FY2026 — an increase of roughly $37 million over the current-year estimate. The draft bill dedicates collections to the public school system consistent with existing local practice.
Industry engagement: The committee record includes comments from CTIA (a wireless trade association) and Verizon; company representatives provided materials and asked technical questions. Committee counsel offered technical amendments intended to clarify statutory language and applicability, and the committee approved those amendments by recorded voice vote before the main motion.
Estimated household impact: OMB’s presentation estimated the change would increase average annual costs for residents by roughly $30–$42 per year depending on current user fees and line counts; Juppay said his analysis backed an estimated 1.229 million data/voice lines in the county when he computed the figure.
Vote and next steps: The motion to move CB 18-2025 favorably passed the committee by roll call (3 yes, 1 no, 1 abstain). Committee members asked staff to supply line-count data used in the revenue estimate and to continue discussions with the Office of Law about the technical amendments. The bill, as drafted and amended in committee, would go to the full council for introduction and further action.
