Hogan, Jones And Ferguson Announce $1.86B Tax Relief Deal
BALTIMORE (WJZ) -- Gov. Larry Hogan, House Speaker Adrienne Jones and Senate President Bill Ferguson have reached an agreement on tax cuts that over the next five years will provide savings to retirees, small businesses and low-income families, the lawmakers announced in a joint release.
Under the deal, retirees making up to $100,00 in retirement income, or married couples making up to $150,000 in retirement income, will have their state income tax significantly slashed or wiped out altogether, Hogan said, a move that impacts 80% of retirees in the state and saves seniors an estimated $1.55 billion.
"Cutting our state's retirement taxes is something we have been trying to accomplish for seven years, and I want to thank the leaders of the General Assembly for working with us to get this done for Maryland's seniors," Hogan said in a statement. "This agreement will deliver on our promise to provide real, long-term relief for hard-working Marylanders dealing with inflation and higher prices, and help create more jobs and more opportunity to continue our strong recovery."
The state is also waiving the sales tax for child care products such as diapers, car seats, and baby bottles, and health products such as dental hygiene products, diabetic treatments, and medical devices, providing Marylanders with an estimated $115.6 million, Hogan's office said.
Businesses in the state will receive a combined $195 million in incentives to "hire and retain workers from underserved communities" through the Work Opportunity Tax Credit program.
The tax cuts are in effect between Fiscal Year 2023 and Fiscal Year 2027. Combined with the gas tax holiday, Marylanders will receive $2 billion in tax relief, according to the governor's office.
Both Ferguson and Jones touted the benefits Marylanders will receive as the state continues to recover from the economic impact of the pandemic.
"As I've said since the beginning of the 2022 legislative session, everything we do must prioritize our state's economy and the health of our residents. This historic agreement demonstrates that regardless of political party, leaders come together to deliver vital services and economic relief for families, seniors, and small businesses," said the senate president.
In addition to the tax cuts, the legislative leaders announced a one-time $800 million investment in the Blueprint for Maryland's Future that mandates increases in education funding.
They also touted budget items that invest in public safety; support hospitals, nursing homes, and assisted living facilities; expand Medicaid coverage; and defend against cyber attacks.
"This bipartisan agreement helps hundreds of thousands of seniors on fixed incomes who are struggling with inflation and puts families on a stronger footing as they buy necessities and pay for child care or college," said Jones. "The significant increase in capital spending, coupled with the Work Opportunity Tax Credit, will help Maryland businesses put more chronically unemployed Marylanders back to work."