11/11/2008
CONTACT: Ellen Valentino, 410-267-0335 or 410-693-2226 (cell)
or Jason Brewer, 202-406-4435
Tax on jobs will send employers scurrying from Maryland
ANNAPOLIS, Md. -- Amid the greatest economic and financial crisis since the Great Depression, small business owners across the state were shocked to learn of a proposal to be unveiled tomorrow that will impose a massive $11 billion payroll tax on the state's struggling job providers under the guise of healthcare reform. The plan, cryptically dubbed "Health Care for All" by its advocates, would impose the largest tax increase in Maryland history to fund a massive state takeover of the healthcare industry.
"They ought to call it unemployment for all," said Ellen Valentino, state director of Maryland's leading small business association, NFIB. "Given the economic crisis we are facing, this payroll tax will be a death sentence for our economy -- this is a tax on jobs that will send employers scurrying from our state."
The overall HCA plan would raise roughly $13 billion in tax revenue, but the vast majority of the revenue comes from a 2 percent payroll levy that would tax every job in Maryland.
Small business employs roughly 53 percent of the state's private labor force, with more than 109,000 small businesses employing 1.1 million Maryland workers—meaning Main Street will pay the biggest price if this plan is enacted. Small employers in Maryland are already coping with rising food and energy prices, higher borrowing costs and a tax increase enacted just last year.
"This tax will fall hardest on the state's small business community at a time when many small employers are desperately struggling to make payroll," said Valentino. "This tax on jobs will put thousands of working families at risk that are already coping with a weak economy and rising energy costs."
Unlike proposals in some states to impose a tax or fee on those employers who do not provide healthcare coverage to their employees, the proposal unveiled today would tax all employers -- regardless of their size and whether they provide healthcare benefits to their workers.
"This is not a plan to cover the uninsured," warned Valentino. "This proposal punishes small business owners who are already providing their employees with benefits.
"This is the wrong tax, at the wrong time and on the wrong people."
Valentino said some small businesses may move their businesses to another state if Maryland imposes a tax on jobs.
"If a plan like this passes, some employers won't have much choice but to evaluate relocating their business to a neighboring state," said Valentino. "It's really a kick in the shins to those who are trying desperately to avoid laying off employees during this crisis."
