ANNAPOLIS — The General Assembly will convene next week to pass a revenue package aimed at raising income tax rates on six-figure earners to pay for public services.
Lawmakers will consider legislation to raise taxes on the top 16 percent of earners, shift a portion of teacher pension costs to counties and undo more than $500 million in reductions that were slated to go into effect because the assembly adjourned last month without passing two notable financial bills.
Under the plan, income tax rates would increase for single filers earning more than $100,000 a year and couples earning more than $150,000.
Gov. Martin O'Malley, Senate President Thomas V. Mike Miller Jr. and House Speaker Michael E. Busch unveiled the plan Wednesday as lawmakers prepare for a special session that will begin Monday and is expected to last two or three days.
The Democratic leaders said revenue increases are needed to prevent education cuts and tuition increases and to protect funding for health and public safety.
“We need a balanced approach — the sort of balanced approach that’s allowed our state to weather this storm better than most states,” Mr. O'Malley said. “A cuts-only approach would help no one and would harm all of us.”
State budget analysts say the plan would bring state spending to about $35.5 billion next year.
It would raise spending by 2.6 percent over last year, which Mr. O'Malley said is the state’s third-smallest year-to-year increase in the past 20 years.
The final budget would be about $400 million smaller than the governor’s proposed budget earlier this year, but about $100 million larger than the “doomsday budget” that lawmakers passed last month.
The bills to be considered next week would add extra spending and revenue to the doomsday plan but would also make alternative cuts.
During the special session, lawmakers will consider a two-bill revenue package that is largely similar to one that House and Senate leaders agreed upon the final night of the regular session but ran out of time to pass.
The two chambers butted heads over exactly how to raise income taxes, but the House plan to add taxes to top earners will win out over the Senate’s proposal for hikes dipping further into the middle class.
The new plan would increase tax rates in most higher tax brackets by an 0.25 percentage point and would raise the state’s maximum tax rate from 5.5 percent to 5.75 percent.
It would also decrease or eliminate the value of personal exemptions in those brackets.
Officials say the changes will generate about $247 million in new revenue next year.View Entire Story
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David Hill joined The Washington Times in February 2011 as a Maryland political reporter. He can be reached at firstname.lastname@example.org.
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