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Maryland's Small Businesses Fear Proposed Tax Hikes
In the heart of Maryland, small business owners are sounding the alarm over Governor Wes Moore's proposed budget for FY2026. The Maryland Chamber of Commerce, representing a significant number of local enterprises, warns that the budget's tax hikes could threaten the very foundation of small businesses. With the state’s deficit set at $2.7 billion, the proposed legislation aims to raise funds but does not sit well with entrepreneurs.
Mary Kane, president of the Maryland Chamber of Commerce, recently urged lawmakers to reject increased taxation on small businesses, emphasizing that applying higher tax burdens fails to acknowledge their critical role in driving economic growth. "We should recognize them as part of the solution," Kane stated, reflecting a deep concern over the state’s approach to its business climate.
Understanding the Tax Changes
Under Governor Moore's proposal, significant alterations to the tax code are on the table. While focusing on fiscal health, the plan includes combining tax brackets creating two new, higher rates for the state's wealthiest residents—6.25% for those earning above $500,000 and 6.5% for millionaires—while simultaneously eliminating inheritance taxes and doubling standard deductions for moderate-income families.
Despite these benefits to individuals, Kane warns that the redesigned corporate tax landscape—alongside the elimination of certain tax credits—risks deterring business investment in Maryland, potentially pushing local establishments out of the market entirely. The Chamber emphasizes that small businesses, which make up 99.5% of the state's companies, will be most affected, highlighted by the significant tax increases as many operate as pass-through entities taxed at individual rates.
A Call for a Balanced Approach
During a critical assembly meeting, Governor Moore proclaimed his intention to bolster Maryland’s appeal to businesses, asserting, "I am very pro-business." He hopes to balance tax relief for families with new revenue sources to stabilize the state’s finances. However, the Maryland Chamber cautions that one wrong move, like imposing burdensome tax obligations, could reverse any economic gains achieved.
Moving Forward Together
As the fiscal deadline looms, with a vote expected on April 1, 2025, the Chamber of Commerce is actively seeking to collaborate with state legislators to construct an economically viable budget that favors growth over taxation. They urge a re-evaluation of the proposed tax policies which might jeopardize Maryland's you thrive in a competitive landscape.
With the potential for change on the horizon, the discourse surrounding Governor Moore's budget intensifies. Small business advocates continue to hold fast to the narrative that their survival is pivotal for the health of Maryland's economy. By fostering a supportive business environment, Maryland can secure both financial stability and continued growth.
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