Maryland’s Digital Ad Tax Gag Rule Gets Smacked Down

It took the Fourth Circuit Court of Appeals to remind Annapolis that the First Amendment still exists, even in Maryland. On August 15, 2025, a three-judge panel unanimously struck down the most brazenly authoritarian portion of the state’s so-called Digital Advertising Tax—a provision that didn’t just tax Big Tech, but muzzled them from telling customers about it.

That’s right. The Maryland legislature, in its infinite arrogance, thought it could force companies to swallow a tax and then ban them from explaining why their prices were going up. The law prohibited two things:

1. Passing the tax directly onto customers, and
2. Informing customers that the tax was the reason for higher prices.

It was less a tax than a censorship scheme, a transparent attempt to shield state politicians from the public backlash that inevitably follows when new costs hit consumers’ wallets.

The Court’s Rebuke

The Fourth Circuit had no patience for this nonsense. The judges ruled the speech ban a blatant violation of the First Amendment, emphasizing that the government’s real motive was to “protect itself from criticism and political accountability.” In other words: Annapolis wanted the cash without the blame.

That is not a “compelling state interest.” That is political cowardice dressed up as policy.

The Bigger Picture

The ruling is a victory for NetChoice, the trade group representing tech companies, which has been fighting Maryland’s one-of-a-kind digital ad tax since its inception. While the tax itself technically survives, the gag order is gone. Companies can now be honest with their customers about why ads, services, and products are getting more expensive.

And here’s the kicker: if prices rise because of the tax, consumers will know exactly who to blame—Governor Wes Moore and the tax-happy Democrats in Annapolis who dreamed this mess up in the first place.

Maryland’s Pattern of Overreach

This is hardly a one-off. Maryland Democrats have developed a habit of pushing “first-in-the-nation” gimmicks that are really backdoor cash grabs—from green energy surcharges to failed tolling experiments. The digital ad tax was sold as a way to make “Big Tech pay their fair share,” but everyone knew from day one that the cost would be passed on to Maryland’s small businesses and everyday consumers.

The only innovation here was the shamelessness: they tried to criminalize telling the truth about it.

Accountability, Not Censorship

This ruling should be a wake-up call. Taxation is supposed to be transparent, debated, and defended in the public square. If Maryland’s leaders are so afraid of political consequences that they must ban companies from speaking honestly about taxes, then the problem isn’t corporate speech—it’s bad governance.

The court has now cleared the way for transparency. Every Marylander deserves to see higher ad prices, bigger bills, and increased business costs for what they are: the direct result of Annapolis’ reckless tax-and-spend obsession.

For once, the courts got it right. Free speech won. Maryland’s political class lost. And the people of Maryland just might finally get the truth.