ANNAPOLIS — Maryland lawmakers are locked on how to repeal a recently approved computer services tax as they go into the final week of the 2008 General Assembly session.
Lawmakers began looking for a solution after business leaders fiercely opposed the tax, which they said was approved without warning under the cover of a special session in the fall.
The Senate does not appear to support a proposal by Gov. Martin O’Malley, a Democrat, to replace the tax with an increase in the personal income tax, saying it doesn’t want to substitute one tax by approving another, especially after approving $1.4 billion in new taxes during the special session.
Leaders said the tax likely will be repealed but are not sure how.
“I think there is a strong consensus that we’re going to repeal this computer tax,” Senate President Thomas V. Mike Miller Jr. said yesterday. “The only issue is whether we adopt the compromise proposal that was put forth by the governor, or do we just look for the cuts in the budget.”
Senate Budget and Taxation Committee Chairman Ulysses S. Currie suggested lawmakers would look at transferring money from the transportation and auto insurance funds and deferring spending on helicopter purchases for the state police, but said details were not available.
“I think the governor is working with all of the members now,” said Mr. Currie, Prince George’s Democrat. “If he can’t get buy-in, we might move to another source.”
House lawmakers have largely avoided the debate, saying they want the Senate to make the first move.
Mr. O’Malley only recently pulled his support for the tax, but has said little.
“If there’s a message I have for you it’s: ’We’re working,’ ” he said.
Mr. O’Malley met for about 15 minutes yesterday with Mr. Miller, Southern Maryland Democrat, who then told senators he would poll them about their preferences on “budget options.”
“When we come around … please don’t run,” he told senators, jokingly.
Democrats appear split about whether the governor has done enough to win support for his so-called millionaire’s tax proposal.
“I don’t know what he’s doing,” said Sen. Rona E. Kramer, Montgomery Democrat. “I haven’t seen him that much.”
Sen. Jamie B. Raskin, Montgomery Democrat, said, “There was no heavy arm twisting.”
Montgomery County lawmakers, who represent the state’s highest concentration of millionaires, have balked at increasing the personal income tax much as they did when Mr. O’Malley floated a similar proposal during the special session.
“What I’m hearing from my constituents is: ’Make cuts if you have to, but don’t raise any more taxes,’ ” said Sen. Nancy J. King, Montgomery Democrat. “That’s all I’m hearing from everybody.”
State agencies that would likely bear the estimated $200 million in cuts and fund transfers began lobbying senators yesterday to spare their funding.
Lobbyists from the Maryland Department of Transportation circulated through the Senate Office Building yesterday afternoon attempting to save much of the $450 million in funding increases the agency received during the special session.
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