Tax plan saves hefty $3.21 a week

November 21, 1996|By MICHAEL OLESKER

The way Gov. Parris N. Glendening explains his brand new 10 percent income tax proposal, the average family will keep about $167 a year more than they do now. This comes to $3.21 a week, which many people will probably blow on a new yacht.

Before we go sailing into the sunset, however, a question arrives: How to pay for this tax cut and still keep the government functioning? No problem, says Glendening. He'll raise the tax on cigarettes from 36 cents a pack to 72 cents a pack. This is a difference of 36 cents. So take your routine nicotine junkie smoking a pack a day. That's 36 cents per day times seven days a week (no time off for junkies), which comes to $2.52 a week.

So it's suddenly $2.52 a week more in personal spending, which comes out of that $3.21 a week in tax cut benefits, leaving a net gain (assuming there's only one smoker in the family) of 69 cents a week.

Which many will probably blow on their rent.

And this is considered the good personal news about the tax cut proposal. The bad news? While that "average" family of four -- defined by the governor as one with $50,000 annual income -- gets its $167 a year ($3.21 a week) bonanza, the not-so-average family making $25,000 annually will save $62 a year.

Or $1.19 a week, which wouldn't even cover the new cigarette tax for that pack-a-day person.

Do we mock the governor's announcement? Yes and no. For a $3.21 a week return to an "average" family, the governor gets to boast, "There! You happy, Ellen? You said I wouldn't cut taxes even 1 percent, but now I've cut 'em 10 percent, so what do you have to say to that?"

What Ellen Sauerbrey, the governor's once-and-future nemesis, might say is: "Big deal. It ain't the 24 percent I recommended."

For which we can all be thankful. But even the Glendening 10 percent proposal carries serious risk. It's easy to nail the cigarette people with another tax, because the industry has run out of vocal defenders. So why stop at a puny 36-cent tobacco increase, especially if the intent is to price cigarettes beyond the reach of kids?

The answer is: Tobacco revenues are considered shaky, and, if they fall significantly further, where's the money to offset that 10 percent income tax cut?

And, whether or not tobacco money holds up, would a 10 percent tax cut mean other problems? Layoffs among state employees? Trimming social programs?

Would it? Who cares? In Washington, we have welfare cuts endorsed by Bill Clinton -- the same Bill Clinton with whom Glendening now encourages personal comparison. Clinton was declared politically dead, but resurrected himself; so, says Glendening, will he.

Inevitably with this governor, we wonder about motivation. With his popularity the lowest among the nation's 50 governors, he needs some headline-grabbing gesture, some little sound bite for future television commercials about cutting taxes for the good of working families. And never mind that it's $3.21 a week for an "average" family. Or maybe $1.19 a week for one not-so-average. And never mind if it endangers government programs aiding people in serious need.

In two years of Glendening in Annapolis, we've all learned to question his every move. This tax proposal, whatever its potential merits, carries trappings of a re-election ploy, an attempt to ward off potential challengers.

In Western Maryland, House Speaker Cas Taylor's regard for the governor now edges toward public contempt as he ponders his own gubernatorial run. Last weekend, Taylor had Kurt Schmoke over to his house for a little schmoozing. It was the mayor's muscle that got Glendening elected in 1994, but their ties are strained after the fight over city schools and that who-said-what-to-whom business about legalizing gambling.

Then there's Rep. Ben Cardin. This is a guy who makes a bold move about once every decade. Asked the other night about a report in this newspaper that he might run against Glendening, Cardin dodged and darted and changed the subject. But if this cautious man is really considering challenging an incumbent governor, he must smell blood in Annapolis all the way from his safe seat in Washington.

Meanwhile, at least three other serious challengers are considering a run. Glendening knows it. So he can talk about a tax cut being a nice jolt for business growth, and it sounds right. He can offer the cigarette tax and wrap himself in the morality of stopping teen-age smoking.

But this governor's track record buys him no unadulterated confidence. We see him with a jaundiced eye. What about that $100 million budget shortfall anticipated for next year? What about that pending court settlement where the state hands $254 million to the city for its schools?

Why propose income tax cuts at such a time? Glendening's history makes us wonder if it's mainly a lunge at higher ratings in the polls. But, at $3.21 a week for an average family, he wants to buy us pretty cheap.

Pub Date: 11/21/96

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