Taxing taxpayers at tax time Writing two checks: State Senate wants localities to share blame for income-tax levies.

April 03, 1997

IT HAS BEEN a sore point with state legislators for years. While they get blamed for imposing a heavy income-tax burden on Maryland citizens, their counterparts in local government never take any heat for their role in boosting the size of the tax bite.

As it stands, Maryland is viewed as a "high-tax" state because of its top 8 percent income-tax rate. But 3 percent of that levy is due to the local "piggyback" tax. If Maryland's 5 percent state rate is viewed on its own, it compares most favorably with other nearby states: It's second-lowest in the New York-Georgia region.

Taxpayers rarely realize that one-third or more of their tax money goes directly to county and city governments. They see a big number on the "taxes due" line of their Maryland form and criticize the governor and legislature. That could change if the state Senate has its way.

These lawmakers added a provision to their income-tax cut bill requiring filers to write two separate checks when paying their state taxes -- one to Maryland Comptroller Louis L. Goldstein and the other to their local county or Baltimore City. It is the Senate's way of forcing Marylanders to recognize that county politicians levy an income tax on them, too.

Good idea in theory. Bad idea in practice.

Those extra checks would mean more work for Mr. Goldstein's clerks, since they would be processing an extra 1.2 million checks from individuals. It also would mean 300,000 more

checks on that last hectic tax-filing day.

Delays in getting all these extra checks deposited would result in an annual $2 million loss in interest income. More personnel and equipment would require another $1.1 million.

Is it worth it? Hardly, especially since only a quarter of taxpayers actually write tax checks: The other three-quarters receive refunds.

Still, House leaders seem inclined to accept the two-checks amendment in its fast-track approval of the Senate's 10 percent income-tax cut. Too bad. It will mean administrative delays and more expenses for state government. Even then, most citizens won't realize that county politicians bear considerable responsibility for those hefty Maryland income taxes.

Pub Date: 4/03/97

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