Maryland Budget Shortfall Jeopardizing Promised Tax Cuts
After eight years of tax increases, Maryland is facing a $600 million budget shortfall, and newly elected Republican Gov. Larry Hogan has to find a way to close that gap — and make promised tax cuts.
“Quite frankly, even I am surprised at the magnitude of the problem, and the task ahead of us is vast,” Hogan told reporters Monday, according to The Washington Post. “The problem seems to be even greater than we expected to be.”
Hogan’s campaign revolved around promises to cut taxes. He successfully linked his Democratic opponent Anthony Brown to current Gov. Martin O’Malley, who has raised taxes 40 times in eight years, and told voters those increases pushed taxpayers out of the state at a cost of billions of dollars in lost tax revenue. (RELATED: These Five Republicans Ran On Conservative Tax Policies And Won)
He promised to find nearly $2 billion of mismanaged and wasted taxpayer dollars to fund tax cuts, but he must also find $600 million dollars this year to close the gap between projected revenue and spending, which is required by Maryland law. Larger shortfalls are projected in following years.
Larger cuts may be delayed because of the unexpectedly high shortfall, but Hogan told a Baltimore radio station he still plans to make at least a few cuts in his first term. An easy target is the so-called rain tax — a highly unpopular tax on stormwater runoff collected by counties in order to satisfy Environmental Protection Agency regulations regarding pollution of the Chesapeake Bay.
“We’re going to try to get spending under control and try to roll back taxes and quickly as we can,” Hogan told The Washington Post, “but obviously, [the shortfall] is a factor.”
“We have to figure out how big of a problem we have with this deficit and how we’re going to address it,” he added.
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