Maryland is ranked as richest state N.J. a close second in household income under census estimate
Digg Del.icio.us Facebook Furl Google Newsvine Reddit Spurl Yahoo Print Single page view Reprints Reader feedback Text size: It's the kind of statistic that makes politicians and economic development gurus cheer: Maryland ranked as the richest state in the nation last year, according to estimates released yesterday by the U.S. Census Bureau.
The state's proximity to Washington's lucrative jobs, its abundance of workers with advanced degrees, and solid health and research opportunities in the Baltimore area continually keep Maryland at the peak of the economic charts, experts said.
"We are able to access a level of job opportunities that are simply not available to the balance of the nation," said Anirban Basu, chief executive of the Baltimore economic consulting firm Sage Policy Group Inc. "That doesn't mean that Maryland doesn't have some degree of impoverishment in rural areas and in Baltimore City. But what Maryland has that many states do not have is pockets of
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Post: #5 Title: Re: ููุงูุฉ ู ูุฑููุงูุฏ ุฃุบูู ููุงูุฉ ูู ุฃู ุฑููุง Author: Deng Date: 08-31-2007, 05:06 AM Parent: #1
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Correction to This Article A July 18 A-section article misstated the personal income tax rate imposed by Prince George's County. It is 3.1 percent, not 3.2 percent. Md. Officials Weigh Overhaul Of Income Tax Rates, Brackets
By John Wagner Washington Post Staff Writer Wednesday, July 18, 2007; A01
Maryland's efforts to close a gaping budget shortfall next year could result in higher income taxes for the state's more affluent residents -- and a possible break for those earning less.
Gov. Martin O'Malley (D) and leading lawmakers say they are giving serious consideration to overhauling the state's tax brackets, which are among the flattest in the nation. Everyone with taxable income of more than $3,000 a year pays the same rate.
O'Malley called the structure "patently unfair" this week, saying at a Democratic breakfast in Frederick that Peter Angelos, the wealthy trial lawyer who owns the Baltimore Orioles, should not pay the same rate as "the woman who cleans his office."
"I'm in favor of progressive taxation, where people who make a lot more pay more," O'Malley told reporters recently.
Such a move would bring Maryland's system closer in line with those of other states and the District: The city's top marginal rate begins after $40,000 a year, and West Virginia and Delaware start their top brackets after $60,000. Virginia's tax structure is somewhat flatter, with the top rate kicking in after $17,000.
With Maryland facing a budget shortfall of nearly $1.5 billion next year, collecting more income tax revenue from the wealthy is a relatively appealing option for lawmakers. Plans that have been floated could yield hundreds of millions of dollars.
But some legislators suggest they should also use the opportunity to provide a break to lower-income residents, who could suffer under other possible budget solutions, such as increases in the sales and gas taxes.
"I think this is a real opportunity to set forward a tax policy that is progressive, that doesn't put all of the burden on middle-income families. . . . We're going to look at all of those kinds of options," House Speaker Michael E. Busch (D-Anne Arundel) said.
Senate President Thomas V. Mike Miller Jr. (D-Calvert) has suggested the idea of a temporary surcharge on the state's highest earners.
And in an interview, O'Malley said an income tax cut for some residents would be a possibility. But he offered no specifics, saying "these are all discussions that are ongoing now."
Maryland's income tax structure has seen few changes since 1967, when U.S. median family income was $7,933 a year. One of the last significant changes started a decade ago, when the top marginal rate was gradually cut from 5 percent to 4.75 percent. That rate applies to all Marylanders with taxable incomes of more than $3,000 a year.
Legislative analysts suggest that Maryland's income tax is more progressive than it looks, particularly for lower-income residents, who are eligible for earned-income credits that can ease their tax burden.
But even when other deductions and exemptions are factored in, the majority of Marylanders pay a similar percentage of their earnings to the government.
Bills seeking to overhaul Maryland's income tax are introduced perennially in Annapolis but typically meet strong resistance.
That is in part because Maryland, a relatively affluent state, relies more on income taxes to pay for government than most other states, in which sales and property taxes are more heavily used. And Maryland is one of few states in which localities impose additional income taxes, ranging from 1.25 percent in Worcester to 3.2 percent in Montgomery, Prince George's and Howard.
House Minority Leader Anthony J. O'Donnell (R-Calvert) said Republicans continue to think that raising taxes of any kind is a bad idea: "Marylanders are not undertaxed. . . . What we have is a spending problem."
But other lawmakers suggest the hole in the state's roughly $15 billion general fund budget might prompt long-term action on the income tax.
To help weather a budget crisis in the early 1990s, Maryland raised its top marginal rate to 6 percent -- but for only three years.
Legislative analysts say more than $350 million could be generated annually if the 6 percent rate is applied to single filers with incomes of more than $150,000 and joint filers with incomes above $225,000.
Progressive Maryland, a group that advocates for working-class families, is pushing a "millionaire's tax surcharge" that would add 3 percent to the top rate for those making $500,000 a year or more. The group says the surcharge could generate an additional $400 million a year.
"They've gotten a lot of tax breaks from George W. Bush, and we feel like they should give a portion of that back to Maryland," Sean Dobson, the group's acting director, said of those who would be affected by the measure.
Any tax relief provided to lower-income taxpayers would, of course, offset gains to Maryland's treasury from increases on the affluent. But some lawmakers, including Busch, suggest making Maryland's tax brackets more progressive is worthwhile, regardless of the effect on the budget gap.
A bill filed during the previous legislative session by two Democratic delegates from Montgomery, Majority Leader Kumar P. Barve and Ways and Means Committee Chairman Sheila E. Hixson, sought to establish a range of rates from 3 percent to 6 percent.
The bill would have provided a modest tax break for most single filers with incomes up to $150,000 and joint filers with incomes up to $250,000. Single filers with incomes of more than $250,000 would have paid an additional $8,065 a year in taxes, on average, and the joint filers in that range would have paid an average of $17,870 more.
The bill still would have left Maryland well short of the range of income brackets and rates that some other states use.
Maryland is not without some company, though. Eight states have a flat income tax, according to the Tax Policy Center. And in one other -- Alabama -- the top tax bracket starts at the same income level as in Maryland.
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