Maryland budget includes $1 billion tax increases

The Maryland House of Delegates passed a preliminary vote on a new budget plan for fiscal year 2026. This plan includes over $1 billion in new taxes and aims to solve a projected $3 billion deficit. The final approval is expected on Wednesday. The budget debate on Tuesday lasted nearly seven hours and involved both Democrats and Republicans. Republicans proposed 20 amendments, which they argued would protect education and assistance for vulnerable groups. House Appropriations Chair Ben Barnes responded that these cuts would harm services for children and students with disabilities. The budget totals $67 billion, which is slightly higher than the previous year. The general fund budget is set at $27 billion and is $414 million less than the current year. Barnes emphasized that the budget reflects different priorities, stating that Democrats prefer to tax the wealthy to support essential services. One major tax proposal includes a new 2% surcharge on capital gains income over $350,000. There will also be changes to the tax code that create two new tax brackets for high earners. Lawmakers claim that 94% of Maryland residents will not see an increase in their taxes. Republicans dismissed this claim, arguing it is misleading. They pointed out that many middle-income earners will likely face extra fees that could negate potential tax cuts. Tensions rose during the debate, with opposition members accusing Democrats of rushing the process and stifling their voices. Despite the disagreements, the budget is on track to be finalized soon. The Senate Budget and Taxation Committee has also made recommendations, and both chambers are expected to reach a final agreement before the legislative session ends on April 7.