Maryland Lawmakers Show Lukewarm Response to Proposal to Increase Taxes
A proposal to increase taxes on high earners and corporations in Maryland has been met with a lukewarm response from lawmakers. The Fair Share for Maryland Act aims to raise $1.6 billion to address the state’s financial problems and meet policy goals, but the chances of a significant tax overhaul in 2024 appear slim. The proposed legislation would prevent multi-state companies from using shell companies to avoid state taxes and force companies incorporated in specific ways to pay taxes. Personal income taxes would also increase for households over $250,000, while those earning less would receive a tax break.
Although the proposed legislation has significant potential to raise revenue, the lawmakers have shown minimal interest in the bill’s ideas, except for one instance in which a Baltimore City Democrat questioned the lobbyists for the businesses against the tax hikes.
Governor Wes Moore’s $63.1 billion budget proposal is under negotiation, and he plans to address the $1.1 billion cash shortfall by reducing spending, increasing borrowing, and using money from the rainy day fund. If passed, his budget may result in a growing structural deficit of up to $3 billion in four years. Del. Julie Palakovich Carr sponsors the Fair Share bill and could help avoid deep budget cuts. Although many Democratic House members have cosponsored it, only four Senate Democrats have signed. Senate President Bill Ferguson has shown little interest in the bill’s ideas and believes there are better times for a conversation about revenues.
Some lawmakers oppose the proposed legislation due to concerns about competitiveness and its potential impact on businesses. Del. Melissa Wells, a Baltimore City Democrat, questioned lobbyists for companies against the tax hikes, asking where the resources to keep communities and enterprises viable could be found and if the lobbyists had any suggestions on how to solve the problem.
Palakovich Carr is pushing for alternative revenue sources, such as increasing local income taxes and implementing fees on electric vehicles. The debate is ongoing, and lawmakers are working to communicate the potential impact of these proposals to the public.
