(1) In this regulation, the following terms have the meanings indicated.
(2) Terms Defined.
(a) "Banners" means signs made of cloth.
(b) "Billboard signs" means freestanding advertising signs alongside a road installed by direct burial or anchor bolted to a concrete base.
(c) "Freestanding signs" means advertising, identifying, or directional signs made of pylons or other material installed by direct burial or anchor bolted to a concrete base.
(d) "Hanging signs" means signs hanging from the interior or exterior of a building.
(e) "Portable signs" means signs which can be moved from place to place, including signs equipped with stands or legs.
(f) "Posters" means signs made of paper or cardboard.
(g) "Signs affixed to a building" means advertising, identifying, or directional signs affixed to exterior or interior walls of a building by means of nails, screws, brackets, glue, or two-sided tape, including neon channel letter signs, box-type electric signs, and pin-mounted dimensional letter signs.
B. Except as provided in §E of this regulation, the sale of a sign is considered to be the sale of tangible personal property subject to sales and use tax. The following are examples of signs which, when installed, are considered to be sales of tangible personal property:
(1) Billboard signs;
(2) Freestanding signs;
(3) Signs affixed to a building;
(4) Hanging signs;
(5) Portable signs;
(6) Posters; and
C. The vendor of a sign considered to be tangible personal property shall collect sales and use tax on the price charged for the sign, including any charges for fabrication labor to make the sign. Separately stated installation charges are not subject to the sales and use tax. Charges for installation of signs at the job site are not considered charges for fabrication and are not subject to the tax. See Regulation .30 of this chapter regarding fabrication and installation.
D. A sign vendor may purchase materials that become incorporated into the sign without paying sales and use tax by issuing the supplier a valid Maryland sales and use tax resale certificate.
E. Signs or plaques embedded into a wall or floor of a building with the intent to be permanent and which cannot be removed are considered improvements to real property. Street or traffic signs installed for governmental entities are considered to be permanently installed and improvements to real property. Sales and use tax may not be collected on the sale of these installed signs. The installer of the sign shall pay the sales and use tax on the purchases of materials used to make the signs.
F. The application of vinyl letters, decals, or paint to a door, building, or vehicle to produce a sign is a non-taxable service. However, all materials and tools used to provide these services are taxable to the provider of the service upon purchase.
G. Lump sum charges for the maintenance and repair of signs are not subject to sales and use tax. If charges for the maintenance and repair are lump sum billed, the repairer shall pay the sales and use tax on all materials used to repair the sign. If charges for labor and materials are separately stated for repair of signs that are considered tangible personal property, the repairer shall collect the sales and use tax on all charges for materials and does not pay the tax on materials used to repair the sign. The repairer is responsible for paying the tax on all materials that are used to repair signs that are considered to be real property.
H. A sign that is shipped or installed, or both, outside the State is not subject to Maryland sales and use tax if it is considered a sale of tangible personal property. Sign materials or fabrication labor, or both, purchased in Maryland for signs installed as real property outside the State are subject to Maryland sales and use tax unless the purchase of the sign materials and fabrication labor would be exempt in the jurisdiction in which the sign is installed.
I. The sale of poles upon which signs are attached and foundations for the poles are considered sales of tangible personal property and are subject to the sales and use tax when the sign itself is considered tangible personal property.