Other assets, such as equipment and furniture, aren't taxed in corporate sales, he argued, so real estate shouldn't be either.
"You won't see properties trade, because this is an additional tax," he said. "It's going to automatically retard any trading."
House Speaker Michael E. Busch plans to make the legislation a top priority.
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"Please," Busch said in response. "I don't think it's going to drive any business away."
Proponents plan to push the bill hard. They say companies are using the loophole increasingly at a time when local governments are desperate for school construction money.
Supporters also point to another effect of the loophole. When commercial properties change hands through sales of companies, the deals are not recorded in local land records. Without knowing what large commercial properties are selling for, it is more difficult for tax assessors to place a value on those and other properties.
Those assessments are what determine how much is paid in property taxes. If the assessments on commercial properties are low, Sen. Brian E. Frosh (D-Montgomery) argued, homeowners end up carrying more of the property tax burden.
The issue first received widespread attention in Maryland in the mid-1990s when the Annapolis and Montgomery malls sold without the payment of transfer taxes.
More recently, One Constellation Center in Oxon Hill was sold for more than $20 million in 2003. Prince George's County lost out on about $390,000 in transfer and recordation taxes, and Maryland wasn't able to collect $90,000, according to an analysis by the state.
Those taxes were not paid in 2001 when Metro Park North, an office building in Rockville, sold for $125 million, according to the state. The same was true in 2003, when Harford Mall sold for $71 million.
The state's transfer tax rate is 0.5 percent of the sale price. County transfer tax rates run as high as 1 percent. County recordation taxes range from $2.20 to $5 per $500 of the sale price.
Frustrated that legislation for the entire state has failed, Del. Elizabeth Bobo (D-Howard) is sponsoring a bill designed specifically for Howard County.
"We can't afford to lose the revenue," she said.
Sen. Ulysses Currie (D-Prince George's), chairman of the Senate Budget and Taxation Committee, where the bill has died in previous sessions, said he supports the legislation.
"These corporations should be required to pay transfer taxes, same as you or I when we buy a house," he said.
Despite his support, the interests aligned against it are strong, he said, which means "it's going to take some heavy lifting on everyone's part."
Sen. Rona E. Kramer (D-Montgomery), who also serves on the committee, said she is not so sure the legislation should pass and doesn't think it has a particularly good chance this year.
If business is driven out of the state because of the legislation, "it could end costing us more than we're gaining," she said. "That's how the Senate has felt. Unless something else has changed in the way the bill is drafted or in information that is brought to us, my guess is the result will be the same."
