- The Washington Times - Wednesday, January 26, 2000

ANNAPOLIS Proposals to give back-to-school shoppers a weeklong break on sales tax got a boost in Annapolis, Md., yesterday after a seventh member of the 14-person Senate Budget and Taxation Committee became a co-sponsor.
The measure already has strong bipartisan support in the House of Delegates and seems likely to clear both chambers this year.
Both the House and Senate bills would exempt clothes and shoes priced under $100 from the state's 5 percent sales tax for one week in August.
Last year a similar measure passed the House but failed to get out of that Senate committee.
Sponsors argue the measure would not only save families money at a time when many do back-to-school shopping, but also would induce those Marylanders who buy in low- or no-sales-tax states like Pennsylvania and Delaware to spend their dollars at home.
The bill has growing bipartisan support in the House, including the backing of Speaker Casper R. Taylor Jr.
Sen. Robert R. Neall, chairman of the Budget and Taxation's subcommittee on education, business and administration, called the proposal a "gimmick" that may be worth trying.
"If this idea takes off and has appeal, maybe we should look at exemption of necessary clothes [year-round]," said Mr. Neall, Anne Arundel County Democrat.
"Retail sales are going to get tough with Internet sales and neighbors with total exemptions," Mr. Neall said, adding that one tax-free week alone on clothes may not provide Maryland retailers what they need to retain their market share.
But Senate Budget and Taxation Chairman Barbara Hoffman said she is worried that the state would be the loser.
"If this goes then … what tax would you like to raise?" Mrs. Hoffman asked Thomas Saquella, lobbyist for the Maryland Retail Merchants Association.
Comptroller William Donald Schaefer estimates the proposal would cost the state about $4.3 million in lost revenue and he supports the idea. The legislature's analysts say it could reduce state revenue by $6.4 million.
But the tax-free week's chances could end under the pen of Gov. Parris N. Glendening, Democrat, who has not said he would veto it, but is not supportive.
"He doesn't think that's the best focus right now," said Mr. Glendening's spokesman Mike Morrill, referring to Mr. Glendening's preference for investing the state's nearly $1 billion surplus on projects that would advance his vision for education and the environment.
Two tax cuts do stand a chance with the governor.
Mr. Glendening supports ending the state's inheritance tax and has left open the possibility that he might back putting the full 10 percent cut in the state's income tax (already cut by 6 percent) in place in 2001 instead of 2002.

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