ANNAPOLIS, Md. (AP) — Maryland lawmakers from the House and Senate came together Friday to announce several ideas for the state economy, including tax credits and a change in the estate tax to exempt a higher amount from taxation.
In the past, lawmakers in the House and Senate have put together separate agendas near the start of the session. However, that hasn’t always worked out well. One chamber’s bill often failed to pass in the other.
This time, Democratic lawmakers who hold strong majorities in the House and Senate are starting out on the same page with confidence the proposals will find easy favor.
“They’re going to be on the floor soon after hearings, and they’re going to be passed,” said Senate President Thomas V. Mike Miller.
One measure would move Maryland’s estate tax in line with the federal government’s over four years. Maryland estates worth more than $1 million are taxed by the state at a rate of up to 16 percent, while the federal government exempts the first $5.25 million of estates and taxes money above that amount at 40 percent.
In the first year under the proposal, the threshold for taxing an estate will rise from $1 million to $1.75 million. It would increase to $2.5 million in the second year, and $3.5 million in the third. In the fourth year, amount would rise to $5.25 million.
Maryland is one of two states that have both an inheritance tax and an estate tax. Supporters of modifying it say too many people are leaving the state in order to avoid paying the tax.
“What tax accountants are doing, what estate lawyers are doing, is telling people to leave the state of Maryland before you die,” Miller said.
Maryland Republicans have criticized the Democrat-controlled General Assembly for years for approving a variety of tax increases proposed by Gov. Martin O’Malley’s administration. They say the long list of tax, fee and toll increases are chasing businesses out of Maryland to other states and harming the business climate.
Another initiative would create a commission to review how that business climate is doing. The commission will focus on incentive programs and make recommendations to legislative leaders by the end of the year.
“It will have numerous members from the private sector on there, from the University System, as well as two members of the House and two members of the Senate,” House Speaker Michael Busch, D-Anne Arundel, said.
A separate measure would create an investment fund to help boost the cybersecurity industry. A new investment fund would make investment of up to $100,000 in early-stage cybersecurity and privacy companies that develop products for both government and commercial markets. Private sector investors would receive tax credits for investing in the fund that would invest in new cyber companies in Maryland.
Another initiative would auction tax credits to the private sector to invest in higher education funding to try to attract top talent to Maryland’s universities, which would seek private sector funds that would be accompanied by state matching funds to pay for endowed chairs in areas of science and technology.
(Copyright 2013 by The Associated Press. All Rights Reserved.)