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Dwayne B.
Dwayne B., Attorney
Category: Business Law
Satisfied Customers: 33086
Experience:  Practicing for over 20 years and helped a number of businesses with litigation.
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Are gratuities taxed by a sales tax in the State of Maryland

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Submitted: 8 years ago.
Category: Business Law
Expert:  Dwayne B. replied 8 years ago.
Can you clarify your question a little? Maybe give me a factual scenario?

Thank you for allowing me to assist you. I believe I have answered all of the questions you asked so I would request that you please click the ACCEPT button so I receive credit for my work and leave feedback if you have a chance. Always feel free to ask additional questions. Please be aware that my answer is not legal advice, it is merely information.
Customer: replied 8 years ago.
The Four Points by Sheraton Hotel in Hagerstown, MD is trying to charge sales tax on a 18% gratuity that has been added into a bill, as follows:

lunches             2037.50
18% gratuity        366.75
6% sales tax        144.26

Total               2548.51

Is this proper? I always thought that a sales tax is imposed on the sale of a product or commodity and on a service in some states. But, on a gratuity???
Expert:  Dwayne B. replied 8 years ago.
Is this on a tab for a party of ten or more?
Customer: replied 8 years ago.
Yes!
Expert:  Dwayne B. replied 8 years ago.
As silly as it sounds Maryland specifically allow this. I am going to post a link below to the Comptroller of Maryland that discusses this topic.

http://business.marylandtaxes.com/taxinfo/salesanduse/salesoffood/restaurant.asp

Thank you for allowing me to assist you. I believe I have answered all of the questions you asked so I would request that you please click the ACCEPT button so I receive credit for my work and leave feedback if you have a chance. Always feel free to ask additional questions. Please be aware that my answer is not legal advice, it is merely information.
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