732                                           LAWS OF MARYLAND                                    Ch. 249

Retail Sales Tax - Computer Software - Exemption

FOR the purpose of providing an exemption from the State sales
taxes for certain computer software if the computer software
is custom computer software; defining a certain term; and
generally relating to a sales and use tax exemption for
certain computer software.

BY adding to

Article 81 - Revenue and Taxes

Section 326(yy)

Annotated Code of Maryland

(1980 Replacement Volume and 1983 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That the Laws of Maryland read as follows:

Article 81 - Revenue and Taxes

326.

The tax hereby levied does not apply to the following sales:

(yy) (1) AS USED IN THIS SUBSECTION:

(I) "CUSTOM COMPUTER PROGRAM" MEANS THE

COMPLETE COMPUTER PROGRAM FOR THE SOLUTION OF A PROBLEM THAT IS
PREPARED PURSUANT TO A SPECIAL ORDER.

(II) "CUSTOM COMPUTER PROGRAM" INCLUDES AN

EXISTING PREWRITTEN PROGRAM THAT IS MODIFIED PURSUANT TO A
SPECIAL ORDER.

(III) "CUSTOM COMPUTER PROGRAM" DOES NOT

INCLUDE A PREWRITTEN PROGRAM PROCEDURE OR ASSOCIATED

DOCUMENTATION THAT IS HELD OR EXISTS FOR ASS PRODUCTION AND SALE
TO THE PUBLIC.

(2) THE SALE OF A CUSTOM COMPUTER PROGRAM, IN

WHATEVER FORM, INCLUDING:

(I) A WRITTEN PROCEDURE;

(II) A REQUIRED DOCUMENT OR MANUAL THAT IS
DESIGNED TO FACILITATE THE USE OF THE CUSTOM COMPUTER PROGRAM; OR

(III) STORAGE MEDIA ON WHICH THE CUSTOM

COMPUTER PROGRAM MAY BE STORED, INCLUDING PUNCHED CARDS, TAPES,
DISKETTES, OR DRUMS.

(YY) (1) SALES OF CUSTOM COMPUTER SOFTWARE SERVICES.