O’Malley Signs New Income Tax Bill To Avoid Doomsday Cuts In Md.
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ANNAPOLIS, Md. (WJZ)—Maryland’s new income tax rates will soon take effect. Governor Martin O’Malley signed it and other bills designed to avoid the so-called doomsday cuts that caused him to call the General Assembly into special session last week.
Political reporter Pat Warren explains this isn’t the last adjustment Marylanders will see.
Rescued from doom by deep pockets “that will support job creation and move us forward with a balanced approach,” said O’Malley.
The new budget will raise tax rates on high earners, lower exemptions for some and eliminate exemptions for others, in addition to making some budget cuts.
Taxpayers filing single will see no change up to $100,000, nor will joint filers up to $150,000. Every dollar after that will be taxed at a higher rate in increments of a quarter percent. The highest earners will pay between 5 and 5.75 percent.
It’s a graduated increase that will have a bigger impact on some parts of the state than others.
High earners in Carroll, Harford, Cecil and Prince George’s counties will likely see increases of $256-$436 more. Taxpayers affected by the hike in Frederick, Howard and Anne Arundel counties and Baltimore City are likely to see increases between $437 and $704. The highest increases are likely to affect residents in Baltimore County, Montgomery and Talbot Counties, ranging from $705 to $955 more this year.
The increases take effect June 1 and are retroactive to Jan. 1 of this year.
Lawmakers get their next shot at raising revenue in a special session tentatively scheduled for July. The governor is expected to call that special session on expanded gambling to include table games and a new casino in Prince George’s County.