ANNAPOLIS, Md. (WJZ) — A sweeping tax increase proposal on services in Maryland drew hundreds to Annapolis on Monday.
The proposal would cut the sales tax from six to five percent. But, a wide-ranging set of services could be taxed that would eventually raise more than $2.5 billion a year.
Maryland realtors were one of the dozens of industry groups opposed to the new taxes on services.
“We’re taxed already enough.” said Craig Wolf, with Maryland realtors.
House Bill 1628 aims to raise money to fund education improvements recommended by the Kirwan Commission.
“It’s competitively disastrous for many of us in the service industry.” said Ellen Silverstein, with the Maryland Society of Accounting and Tax Professional.
The state’s Chamber of Commerce said broadening the tax base levels the playing field.
“Over time, our economy has become more services-based, so our economy has been more degraded over time. People are buying less things and more services.” said Del. Eric Luedtke (D), Montgomery County.
“We need to find existing resources to fix the problem and address the problem.” said Matt Morgan, (R), St. Mary’s County.
In the hearing room, debate centered on keeping Maryland competitive with neighboring states.
Educators challenged opponents to support the bill or find another way.
“If you’re against this bill, ok. But, then tell us what you are for.”
The sponsor of this bill admits this is essentially a starting point. The debate on modernizing the tax code and funding Kirwan will likely take many forms in the coming weeks.