Tuesday, November 20, 2007

The Tax Package Comes Home

WaPo says in this story that residents "who buy new cars, smoke cigarettes and get their computers fixed will be among the hardest hit" by the tax package approved by the General Assembly this week.

Computers fixed?

"The lion's share of new revenue is generated by the state sales tax, which will increase from 5 percent to 6 percent. The sales tax will be applied to computer services, which are now exempt, a move estimated to raise about $214 million."

A 6 percent sales tax means Amazon and other online retailers just got cheaper.

The tax on your smokes will go up from $1 per pack to $2. The corporate income tax will climb from 7 percent to 8.25 percent. The titling tax on your car will go from 5 percent to 6 percent.

Income taxes will go up for the wealthier among us. Currently, everyone pays a flat 4.75 percent rate on income above $3,000. Under the new plan, single filers reporting more than $150,000 income and joint filers reporting more than $200,000 in income will be taxed at progressively higher rates.

After all the revenue adjustments, Howard will see state aid grow by $6.6 million to $273.3 million in fiscal 2009, according to a chart in WaPo. But all you will hear is complaints that we are "losing" $8.8 million that we had hoped to get on top of that.

This from the Sun: "The final General Assembly votes left another $550 million in cuts for O'Malley to make in the fiscal 2009 budget that he is to propose in January, which also concerns local officials.

'We think the cuts are about $9 million or $10 million, but that's before the governor spells out the $550 million. I'm assuming some portion of that will come from counties,' said Howard County Executive Ken Ulman."

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