The segments below provide a brief overview of MACo’s work on tax policy in the 2025 General Assembly.
The General Assembly routinely considers proposals to change tax structures, often seeking to stimulate economic growth, encourage beneficial activities, or attract and retain residents. These proposals sometimes focus exclusively on the State’s tax structure but sometimes extend to local revenues.
In general, MACo stands for local self-determination. Counties, led by their elected leaders who are directly accountable within the community, are best positioned to make decisions on local affairs – ranging from land use to budget priorities. MACo steadfastly guards this local autonomy and frequently advocates against statewide solutions that mandate county compliance or override local decision-making.
Maryland’s 447th legislative session convened amidst a substantial concern over the State’s fiscal situation, with weakened revenues and cost increases for many services at every level of government. Despite the budgetary limitations, many policy issues received a full debate, with many resolutions arising from the 90-day annual process. MACo’s legislative committee guided the association’s positions on hundreds of bills, yielding many productive compromises and gains spanning counties’ uniquely broad portfolio.
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MACo supported HB 969/SB 774 – Property Tax – Payment in Lieu of Taxes Agreements – Broadband Service Providers – with amendments. As introduced, this bill granted rural broadband service providers a permanent tax carveout, giving them a lasting advantage over other industries while shifting significant costs onto counties. MACo’s amendments authorize counties to expressly negotiate Payment in Lieu of Taxes (PILOT) agreements with broadband providers. PILOT agreements provide a flexible, locally driven tool that allows counties to balance economic development incentives with fiscal responsibility while ensuring broadband companies contribute to the communities they serve. This bill passed the Maryland General Assembly with MACo’s amendments.
Bill Information | MACo Coverage
MACo supported HB 390/SB 327 – Affordable Housing in Lieu of Taxes Expansion Act. This bill offers counties a practical and flexible tool for promoting the development and sustainability of affordable rental housing through Payment In Lieu of Taxes (PILOT) agreements. This bill passed the Maryland General Assembly.
Bill Information | MACo Coverage
MACo supported HB 151/SB 70 – County Income Tax – Rate and Income Brackets – Alterations. This bill would have enabled county governments to implement equitable local income tax structures tailored to community priorities. While the bill failed, the Budget Reconciliation and Financing Act of 2025 authorizes counties to impose a maximum local income tax rate of 3.3%, an increase from the current cap of 3.2%.
Bill Information | MACo Coverage
MACo opposed HB 35/SB 91 – Economic Development – Income Tax Benefit Transfer Program – Establishment. This bill would have established the Income Tax Benefit Transfer Program in the Department of Commerce, creating broad uncertainty about its impact on local revenue streams and essential services. This bill did not pass in the 2025 session.
MACo supported HB 1111 – Public Utilities – Solar Energy Generating Systems – Systems Located on or Over Water Retention Ponds, Quarries, or Brownfields with amendments. As amended, the bill authorizes counties to exempt floating solar systems and brownfield solar projects from local property taxation. This bill passed the Maryland General Assembly with MACo’s amendments.
Bill Information | MACo Coverage
MACo opposed HB 726 – Homestead Property Tax Credit – Eligible Properties. This bill would have opened up property tax savings under the Homestead Property Tax Credit to include additional residences beyond “owner-occupied” homes, which would have dramatically undermined the longstanding policy purpose of the credit – to ensure stability in tax bills after purchasing a principal residence. This bill did not pass in the 2025 session.
Bill Information | MACo Coverage
MACo opposed HB 1214 – Property Tax – Homestead Property Tax Credit – First-Time Homebuyer. This bill would have imposed an unfunded mandate, a new property tax credit for first-time homebuyers under the Homestead Property Tax Credit, which would have significantly reduced local governments’ primary revenue source — property taxes. This bill did not pass in the 2025 session.
Bill Information | MACo Coverage
MACo opposed SB 822 – Property Tax – Tax Credit for Nonprimary Residence. This bill would have mandated a property tax credit for nonprimary residences, forcing a costly, state-imposed reduction in local revenue when counties are already grappling with growing fiscal pressures. This bill did not pass in the 2025 session.
Bill Information | MACo Coverage
MACo took no position on HB 953 – Homeowner Protection Program – Funding and Alterations. As introduced, MACo urged the General Assembly to address the bill’s local fiscal impact. As amended, this bill significantly reduces the local fiscal impact and strengthens the Homeowner Protection Program (HPP) by enhancing outreach, improving reporting requirements, and creating a new funding mechanism.
MACo strongly prefers that homeowners receive counseling, education, information, and support to help them stay current on tax obligations and avoid tax sale. To that end, MACo supported legislation establishing the HPP and continues to advocate for effective, sustainable solutions that provide timely assistance without imposing new unfunded mandates on local governments. This bill passed the Maryland General Assembly.
Bill Information | MACo Coverage
MACo supported HB 997/SB 324 – Admissions and Amusement Tax – Food and Beverages. This bill, a Maryland Municipal League (MML) priority, would have offered local governments a much-needed tool to modernize revenue structures by empowering counties to implement sensible revenue solutions by authorizing local governments to impose an admissions and amusements tax of up to 3% on gross receipts from food or beverage sales under specified circumstances. This bill did not pass in the 2025 session.
Bill Information | MACo Coverage
MACo supported HB 101/SB 204 – Property Tax – Deadline to Set County and Municipal Corporation Tax Rates – Alteration with amendments. This bill would have moved the deadline for counties and municipalities to set property tax rates from July 1 to June 1. Counties sought amendments to minimize disruptions to local budget timelines and processes. This bill passed the Maryland General Assembly with MACo’s amendments to set a June 20 deadline.
Bill Information | MACo Coverage
MACo opposed HB 919 – State Tax Credits, Exemptions, and Deductions – Alterations and Repeal. This bill would have repealed proven incentives to attract investment, create jobs, and strengthen local economies. Without these programs, counties would have lost a competitive edge in securing business growth and sustaining economic opportunity. This bill did not pass in the 2025 session.
Bill Information | MACo Coverage
MACo supported HB 1103/SB 979 – Local Government – Accommodations Intermediaries – Hotel Rental Tax Collection by Comptroller with amendments. This bill aimed to centralize short-term rental (STR) tax collection under the Comptroller, improving tax administration while ensuring that STRs provide a fair and consistent local revenue source. Counties sought amendments to require STR platforms to verify and report local licenses, ensure counties receive property-level tax remittance data, preserve independent audit authority to prevent underreporting and lost revenue, and guarantee that all STR operators, regardless of platform size, would be subject to the same tax collection and remittance requirements to create a level playing field. The Senate bill passed the Maryland General Assembly with amendments to delay its implementation date until July 1, 2027. The delay provides time for stakeholders to address potential concerns before implementation.
Bill Information | MACo Coverage
MACo supported HB 942 – Economic Development – Tax Increment Financing – Noncontiguous Areas. This bill would have expanded local authority to use Tax Increment Financing (TIF) for economic redevelopment, enhancing a vital tool for targeted revitalization and strategic economic growth by allowing counties to designate noncontiguous blighted areas as development districts. This bill passed the House but did not advance in the Senate.
Bill Information | MACo Coverage
MACo supported HB 389/SB 516 – Property Tax – Day Care Centers, Child Care Homes, and Child Care Centers. This bill expands an existing local-option property tax credit counties may offer for childcare facilities and enhances local flexibility to incentivize and support childcare providers through targeted property tax incentives. This bill passed the Maryland General Assembly.
Bill Information | MACo Coverage
MACo took no position on HB 1085 – Housing Authorities – Tax-Exempt Status – Modifications, as amended. As amended, this bill expands property tax exemptions for public housing authorities (PHAs), their subsidiaries, and affiliated nonprofit entities. This bill passed the Maryland General Assembly.
Bill Information | MACo Coverage
MACo supported HB 59/SB 192 – Property Tax – Tax Sales – Revisions. As amended, the bill raises the arrears threshold for tax sales, introduces new recordkeeping requirements, and prohibits tax sales for unpaid water charges, which could undermine essential revenue streams. This bill passed the Maryland General Assembly with MACo’s amendments.
Bill Information | MACo Coverage
MACo supported HB 23 – Property Taxes – Authority of Counties to Establish a Subclass and Set a Special Rate for Commercial and Industrial Property. This bill would have allowed county governments to impose a separate property tax rate on specific subclasses of real property to fund local transportation priorities and public schools. This bill passed the House but did not advance in the Senate.
Bill Information | MACo Coverage
MACo supported HB 330 – Property Tax – Improvements to Property Adjacent to Rail Stations – Subclass, Special Rate, and Penalty and its cross-file, SB 472 – Property Adjacent to Rail Stations – Subclasses and Special Rates with amendments. This bill would have allowed counties to create a new subclass of real property for improvements within one mile of a rail station and establish a special property tax rate for those properties. Counties requested amendments to ensure every dollar of locally generated revenue directly benefits county residents and services. This bill passed the Senate but did not advance in the House.
Bill Information | MACo Coverage
MACo supported HB 296 – Personal Property Tax – Exemptions for Low Assessments – Alteration. This bill would have preserved tax relief for small businesses while allowing the State Department of Assessments and Taxation (SDAT) to collect basic eligibility information. This bill passed the House but did not advance in the Senate.
Bill Information | MACo Coverage
MACo supported HB 341/SB 344 – Property Tax Credit – Retail Service Station Conversions. This bill would have enabled local governments to enact a property tax credit for specified converted retail stations and required the State to reimburse local governments for half of the foregone property tax revenue resulting from the credit. This bill did not pass in the 2025 session.
Bill Information | MACo Coverage
MACo supported HB 6/SB 143 – State Department of Assessments and Taxation and Department of General Services – Property Appraisal Aids – Geographic Images with amendments. This bill would have provided the State Department of Assessments and Taxation (SDAT) with advanced digital tools to improve property assessments’ accuracy, efficiency, and fairness. Counties requested amendments to reduce unnecessary costs and ensure a smooth implementation process. This bill passed the House but did not advance in the Senate.
Bill Information | MACo Coverage
MACo opposed HB 149 – Income Tax – Subtraction Modification – Child Support Payments. This bill would have established a personal income tax subtraction modification for the amount of certain child support payments made by an individual during the taxable year. MACo and county governments stand ready to work with state policymakers to craft flexible and optional tools to deliver broad or targeted tax incentives but resist state-mandated changes that preclude local input. This bill did not pass in the 2025 session.
MACo opposed HB 1390 – Income Tax – Subtraction Modification – Losses From Theft or Fraud. This bill would have reduced taxable income if an individual had experienced certain personal property losses not related to a trade or business that arose under specific conditions such as theft or fraud. MACo and county governments stand ready to work with state policymakers to craft flexible and optional tools to deliver broad or targeted tax incentives but resist state-mandated changes that preclude local input. This bill did not pass in the 2025 session.
MACo opposed SB 412 – Income Tax – Subtraction Modification – Maryland 529 Plan Contributions. This bill would have increased the income tax subtraction modification limit for contributions to Maryland 529 Plans. This bill did not pass in the 2025 session.
MACo opposed HB 792/SB 30 – Income Tax – Subtraction Modification – Public Safety Employee Retirement Income. This bill would have increased the amount of retirement income that public safety workers could subtract from their taxable income. MACo and county governments stand ready to work with state policymakers to craft flexible and optional tools to deliver broad or targeted tax incentives but resist state-mandated changes that preclude local input. This bill did not pass in the 2025 session.
MACo opposed HB 590/SB 759 – Income Tax – Subtraction Modification – Public Safety Employee Retirement Income. This bill would have expanded the current income tax subtraction modification for public safety workers, including retirement income for 9-1-1 specialists. MACo and county governments stand ready to work with state policymakers to craft flexible and optional tools to deliver broad or targeted tax incentives but resist state-mandated changes that preclude local input. This bill did not pass in the 2025 session.
MACo opposed HB 815/SB 419 – Income Tax – Subtraction Modification – Public Safety Volunteers. This bill would have increased the income tax subtraction modification for individuals qualifying as public safety volunteers. MACo and county governments stand ready to work with state policymakers to craft flexible and optional tools to deliver broad or targeted tax incentives but resist state-mandated changes that preclude local input. This bill did not pass in the 2025 session.
MACo opposed HB 355 – Income Tax – Subtraction Modification – Retirement Income. This bill would have altered the State’s subtraction modification for retirement income by altering the value of the exclusion and increasing the sources of retirement income eligible for the exclusion. MACo and county governments stand ready to work with state policymakers to craft flexible and optional tools to deliver broad or targeted tax incentives but resist state-mandated changes that preclude local input. This bill did not pass in the 2025 session.
MACo opposed HB 800 – Income Tax – Subtraction Modification for Military Retirement Income – Individuals Under 55. This bill would have increased the subtraction modification for individuals under 55 who receive military retirement income. MACo and county governments stand ready to work with state policymakers to craft flexible and optional tools to deliver broad or targeted tax incentives but resist state-mandated changes that preclude local input. This bill did not pass in the 2025 session.
MACo opposed HB 60/SB 99 – Income Tax – Subtraction Modification for Military Retirement Income (Keep Our Heroes Home Act). This bill would have increased the existing maximum subtraction for military retirement income. MACo opposes state-mandated reductions in local revenue sources, but county governments welcome flexible and optional tools to serve and react to local needs and community priorities.
MACo and county governments stand ready to work with state policymakers to craft flexible and optional tools to deliver broad or targeted tax incentives but resist state-mandated changes that preclude local input. This bill did not pass in the 2025 session.
MACo opposed HB 1005 – Income Tax – Tips or Gratuities – Subtraction Modification (No Income Taxes on Tips Act). This bill would have created a tax deduction for tips or gratuities earned in specific jobs, like working in a restaurant, bar, hotel, or providing taxi or passenger services. MACo and county governments stand ready to work with state policymakers to craft flexible and optional tools to deliver broad or targeted tax incentives but resist state-mandated changes that preclude local input. This bill did not pass in the 2025 session.
MACo opposed HB 1444 – Local Government – Moderate Income Housing Unit Requirements – Prohibition Against Fee-in-Lieu. This bill would have prohibited counties and municipalities from authorizing a fee-in-lieu of moderate-income housing requirements in new residential development projects, stripping counties of a vital tool for advancing affordable housing. This bill did not pass in the 2025 session.
Bill Information | MACo Coverage
MACo opposed HB 1400/SB 823 – No Tax on Tips Act. This bill would have phased out the tip credit for tipped employees, requiring an employer to pay tipped employees at least the State minimum wage. MACo and county governments stand ready to work with state policymakers to craft flexible and optional tools to deliver broad or targeted tax incentives but resist state-mandated changes that preclude local input. This bill did not pass in the 2025 session.
MACo submitted a letter of information on HB 167 – Vehicle Excise Tax – Rate Increase. This bill would have provided a mechanism to raise revenue for the State’s Consolidated Transportation Trust Fund. Still, local governments face a dire crisis as transportation funding remains unpredictable, severely insufficient, and far below historical levels. This bill did not pass in the 2025 session.
Bill Information | MACo Coverage