Montgomery County Executive Ike Leggett warned state lawmakers Thursday to not hurt “the economic engine of the state,” but offered no ideas on how to avoid higher income taxes for the county’s residents.
“I am very concerned about the long-term effect it could have on Montgomery County’s role as the economic engine of the state and our ability to remain competitive,” Leggett told a joint hearing of the House Ways and Means and Senate Finance committees.
“In fact, under the administration’s plan, the highest income tax in the D.C. area would be paid in Montgomery County and Prince George’s County.”
Gov. Martin O’Malley wants to raise the income tax from 4.75 percent to 6 percent for people earning more than $150,000 and to 6.5 percent for people earning more than $500,000. While most Maryland citizens would seeincome tax cuts under the plan — their tax rate would be dropped to 4 percent — Montgomery County residents would fork over 80 percent of the increased revenue, according to data from the state comptroller’s office.
Leggett has consistently said he supports O’Malley’s plan to make the state’s income tax rate more progressive. He also has said, and told legislators Thursday, that he worries about the “unintended consequences” of the governor’s plan, which seeks to shore up a $1.7 billion budget deficit.
Sen. Rona Kramer, chairwoman of Montgomery County’s Senate delegation, said county legislators were not likely to support much change in the income tax structure.
“We will not support anything that hurts Montgomery County any more disproportionately than it already is in the taxation and in the other piece of the puzzle, which is how much money Montgomery County receives back in the state’s budget,” she said.
Leggett had said Wednesday that he planned to offer an alternative to the governor’s proposal: seven tax brackets, with the state’s highest earners being taxed at 5.5 percent instead of 6.5 percent. But he mentioned no specifics Thursday.
“I think the executive realized the delegation was not likely to support anything more than that, and I think he respected that and is working with us in that regard,” Kramer said.
Del. Luiz Simmons said nobody in the county delegation with whom he had spoken had anticipated Leggett floating his own proposal.
“… He was urged not to interject himself at this point because it would undermine the bargaining position of our county in Annapolis,” Simmons said.
Leggett told The Examiner Thursday his earlier proposal was a “starting point,” not a “line you don’t cross.”
