O’Malley, Lawmakers Agree On Income Tax Hikes
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ANNAPOLIS, Md. (WJZ)– Governor Martin O’Malley outlines the game plan for raising taxes in the General Assembly session that begins Monday.
Political reporter Pat Warren has more on what to expect next week.
The special session will close a hole in the 2013 budget with an income tax hike and transferring half the cost of teacher pensions from the state to local governments.
After weeks of finger-pointing and threats of deep cuts, the governor, the Senate President and the Speaker of the House have agreed on what Maryland taxpayers will have to pay to feed the government kitty.
“We will be moving forward with a revenue package that will call on about 16 percent of us who are in the top earning brackets in our state to pay a little more and that’s the primary revenue measure that will be adopted here,” Gov. Martin O’Malley said.
So what’s a top earner and how much is a little?
Single-filers with an adjusted gross income up to $100,000 will see no change. After that, there’s a 0.25 percent increase on every dollar, raising the tax from 4.75 percent to 5 percent.
Filing jointly, there’s no change up to $150,000. Then there’s a 0.25 percent increase on every dollar, raising the tax from 4.75 percent to 5 percent.
The increase will help prevent $512 million in cuts to K-12 education, hikes in college tuition and cuts to state agencies and programs.
“People are going to complain about revenues for higher income earners but at the same time, there’s cuts across the board for people that are going to feel it in their pocketbooks and they’re going to feel it in the schools, the environment and everywhere else,” Senate President Mike Miller said.
This proposed combination of cuts and revenues is called a balanced approach.
The special session starts Monday and is expected to last three days.
The governor is also considering a second special session on expanded gambling.