Marvin Mandel, Governor                        1733

CHAPTER 605
(House Bill 737)

AN ACT to repeal and re-enact, with amendments, Section 278A
of Article 81 of the Annotated Code of Maryland (1969 Replace-
ment Volume), title "Revenue and Taxes," subtitle "State Prop-
erty Transfer Tax," to revise various provisions of the State
property transfer tax law with particular respect to the instru-
ments subject to and exempt from the tax, the computation of
tax applicable to long term leases, and the manner of evidenc-
ing payments of the tax.

Section 1. Be it enacted by the General Assembly of Maryland,
That Section 278A of Article 81 of the Annotated Code of Maryland
(1969 Replacement Volume), title "Revenue and Taxes," subtitle
"State Property Transfer Tax," be and it is hereby repealed and
re-enacted, with amendments, to read as follows:

278A.

In order to pay the principal and interest on the certificates of
indebtedness issued pursuant to the "Outdoor Recreation Land Loan
of 1969," or "Program Open Space" ;

(a)    A tax is hereby imposed upon every written instrument con-
veying title to real property, or a leasehold interest therein, of-
fered for record and recorded among the land records in the State,
but conveyances [ to the State or to any agency or instrumentality
thereof, or to any political subdivision of the State] by or to the
United States, the State, or any poltiical POLITICAL subdivision of
the State, or any agency or instrumentality thereof, shall not be sub-
ject to the tax imposed by this section. The term "written instru-
ment" includes leases for a term of years above seven years, not
perpetually renewable but does not include any mortgage, deed of
trust, conditional sales contract, or any other device the purpose of
which is to afford a security in real property rather than convey
title thereto.

(b)    The tax imposed by this section shall be levied at the rate
of one half of one per cent (0.5%) of the actual consideration paid
for the conveyance of title and shall be collected by the clerks of
the circuit courts of the counties or the clerk of the Superior Court
of Baltimore City.

(c)    In the case of the creation of or a transfer of a perpetually
renewable ground rent, the tax shall be based upon the capitaliza-
tion at 6 percent of the annual ground rent, plus the actual con-
sideration, other than the capitalization of the ground rent, paid or
to be paid.

(d)    [In the case of a lease for a term of years above seven
years, not perpetually renewable, the tax shall be based upon the
capitalization at 10 per cent of the average annual rental over the
entire term of the lease, including any renewal term, plus the
actual consideration, other than rent, paid or to be paid. Where
the average annual rental cannot be determined, the tax shall be
based upon a figure arrived at by multiplying the assessed value
of the property covered by the lease by two.]