offices. All assessments are made in accordance with the Tax-Property Article and Arti-
cle 81 of the Maryland Code subject to the many exemptions allowed by the various coun-
ties and incorporated towns.

Assessments are made annually on the basis of sworn returns covering all tangible
personal property. Notices are sent and the assessments are certified to the local finance
offices for billing and collection. An annual examination is made of the files, and corpo-
rations which have failed to file the required reports are certified for forfeiture of their
charters.

To enhance the overall efficiency of the operations of the Personal Property section,
an automated corporate assessment certification system was implemented in 1986 as was
an electronic data processing tax billing system. This tax billing system was initially in-
stalled in four counties and allows for cost savings to local governments.

Public Utilities and Railroads

This section administers the various ordinary and special taxes in accordance with
the Tax-Property Article and Article 81. Principal among these is the assessment of the
operating property, except land, of railroads and public utilities. Because of certain differ-
ences, both in the law and in the essential structure of the properties covered by the law,
methods of assessment and the general administration of this particular property tax vary
from the ordinary business personal property tax. The property is assessed on the uni-
tary basis. The assessment is then certified according to location, except for domestic
operating personal property placed in service prior to 1968 which is distributed on the
basis of the residences of the shareholders. Where shareholders reside outside the State
of Maryland, the certification is based on the location of principal offices.

A special gross receipts tax is assessed and certified by the Department on gross receipts
of public utilities.

Banks and Financial Corporations

In 1968, the share tax on national and state commercial banks and trust companies
and other financial corporations was abolished. In place of this tax, a franchise tax, meas-
ured by the net income from all sources, was submitted. The taxable base includes in-
terest on certain investments that normally would be exempt under federal and state tax
laws. The revenue derived from the tax goes wholly to State General Fund, and the law
enacted provides for a grant to the subdivisions to offset their loss from the elimination
of the share tax.

Building, Savings & Loan Associations, and Savings Banks

Effective July 1,1984, this Department assumed responsibility for administration of
the franchise tax that applies to Savings and Loan Associations. The tax is calculated us-
ing the same method used for commercial banks. This local revenue, less 1 % for adminis-
tration, is distributed to the subdivisions on the basis of the deposits generated by each
office.