MACo Advocates for Equity-Driven Local Tax Flexibility

On January 15, Legislative Director Kevin Kinnally testified before the Budget and Taxation Committee in support of SB 70 – County Income Tax – Rate and Income Brackets – Alterations. This bill empowers counties to implement fair and balanced tax policies while safeguarding vital services.

This bill advances MACo’s Legislative Initiative to broaden local revenue options, empowering counties to respond to unique fiscal conditions and community-driven priorities.

In 2021, the General Assembly authorized counties to implement bracket-based local income taxes to advance equity. However, this reform has not been fully accessible for more than two-thirds of Maryland residents living in counties with the maximum 3.2 percent rate. Without the flexibility to exceed the cap under limited circumstances, counties cannot provide targeted relief to working families or residents on fixed incomes while sustaining essential services like education, infrastructure, public health, and emergency services.

Accordingly, SB 70 raises the cap to 3.7 percent for taxable income exceeding $250,000 for individual filers and $300,000 for joint filers. This targeted adjustment enables counties to adopt equitable tax structures that deliver relief to those who need it most while directing any additional revenue to public education and transportation, as outlined in the bill.

From MACo Testimony:

MACo consistently advocates for local self-determination, emphasizing that elected county leaders, accountable to their communities, are best positioned to tackle unique fiscal and policy challenges. Accordingly, SB 70 empowers counties to design revenue systems that meet local priorities while sustaining essential services like education, public safety, and infrastructure.

More on MACo’s Advocacy:

SB 70’s cross-file, HB 151, was heard on January 30 in the House Ways and Means Committee. Kevin Kinnally testified in support of this bill.