Without action from the Maryland General Assembly, state taxpayers would see their state tax bills rise by $1.2 billion next year. This is a byproduct of the new federal tax law signed into law at the end of December 2017, which reduces and eliminates a variety of tax deductions.
The Maryland Senate, however, has passed a bill that would allow Marylanders to continue to take personal exemptions on their state tax returns even though this tax break has been eliminated on federal tax returns. A similar bill is pending in the Maryland House and is sponsored by a majority of delegates.
If this legislation isn’t passed, the state Bureau of Revenue Estimates has calculated that state revenue would increase by $730 million and local government revenue would rise by $490 million. Even with the passage of this bill, Maryland taxpayers could see their state tax bills increase by more than $400 million. Earlier in the legislative session, Gov. Hogan and legislative leaders were working on competing plans to address this issue, however, so more proposals are likely to come.