Maryland Gov. Wes Moore and legislative leaders have agreed on a state budget framework that includes cuts and tax reform to address a $3.3 billion deficit. The budget framework relies on spending cuts over tax increases and is the largest amount of cuts from a Maryland state budget in 16 years. The agreement includes tax increases on wealthy Marylanders, while low and middle-income residents can expect tax breaks.
The budget framework also modernizes the state’s tax code by imposing a 3% tax on IT and data services to avoid raising Maryland’s sales tax on goods. The budget does not increase fees on deliveries, property taxes, estate taxes, or the gas tax. There will be increases to gaming and cannabis taxes, but specifics were not provided at the news conference. Federal government cuts and uncertainty over funding have impacted the decision to make cuts and increase taxes in Maryland.
Republican legislative leaders expressed concerns over the tax increases on wealthy Marylanders, stating that it could hurt job creators and lead to residents leaving the state. House Minority Leader Jason Buckel criticized the Democratic values, calling it a tax-and-spend policy.
The budget is still being worked on in house committees and will go to the House floor for a full vote and debate next week before heading to the Senate. The Maryland Board of Revenue Estimates anticipates the state losing $280 million in revenue over the next two years due to declining tax revenues and federal cutbacks. Stay updated on the developments by following David Collins on 11 News and other WBAL-TV platforms.
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