GOP slams budget plan

Delegates say sales tax rise will hit working families hardest

October 02, 2007|By Jennifer Skalka | Jennifer Skalka,Sun reporter

House Republican leaders slammed Gov. Martin O'Malley's plan to address Maryland's $1.7 billion budget deficit yesterday, saying the higher sales and cigarette taxes will hit working families hardest and even force some to move out of the state.

They also chided him for calling for a November special session of the legislature to approve the package and argued that the public would have a better opportunity to weigh in during the annual three-month General Assembly session, which starts in January.

"Governor O'Malley has been trying to convince Marylanders that his proposals are actually a tax cut for the vast majority of taxpayers, but his numbers don't add up," said House Minority Leader Anthony J. O'Donnell of Southern Maryland. "Do the math. We ask Maryland to do the math. This is at best confusing and at worst deceitful to Maryland residents and taxpayers."

O'Donnell, joined by House minority whip Christopher B. Shank, said the special session would actually cost taxpayers money - from $23,000 to $34,000 a day - and pay short shrift to the views of average citizens, who wouldn't have the benefit of the traditional public hearing process.

He said the governor has resisted the GOP's budget suggestions, including a proposal that the state limit any increase in government spending to 3.5 percent, and that O'Malley as a result shouldn't count on the Republicans to back his slots plan.

"The governor has proposed the largest tax increase in Maryland's history, which requires thorough review and debate, and not a rubber stamp from the General Assembly," Shank said.

O'Malley's plan to tackle Maryland's budget woes would include a restructuring of the state's income tax, which he says would reduce taxes for lower-income families while raising taxes for the wealthy; an increase in the state sales tax from 5 percent to 6 percent; a doubling of the cigarette tax to $2 a pack; and an increase in the car titling tax. He is advocating an increase in the corporate income tax rate from 7 percent to 8 percent.

The governor also has put forward a proposal to legalize slot machine gambling in Maryland that he says would raise $500 million to $600 million annually.

Asked to comment on the criticism, O'Malley spokesman Rick Abbruzzese said the governor has proposed "a comprehensive, long-term plan to address the structural deficit that reduces spending growth by more than a billion over two years and makes our tax structure fairer for working families."

As leaders of both parties proceed with discussions about solutions to the budget crisis, several issues are emerging as possible areas ripe for disagreement. The GOP leadership, including the Senate's top officials, are dead set against tax increases and promise to dig in on that issue - despite being outnumbered significantly in both chambers. But slots, too, is expected to emerge as a bargaining chit for the GOP in the House and Senate.

Senate Republicans didn't stand with their House counterparts yesterday because they haven't said whether they would back a slots proposal. While O'Donnell and Shank said they prefer their own slots proposal, with its emphasis on higher initial licensing fees and a call for 15,000 slot machines, the House leaders have registered general support for slots.

Senate Minority Leader David R. Brinkley said his caucus, on the other hand, is "keeping our powder dry on that."

"I think we're very much arm in arm on all this stuff," Brinkley said of his House counterparts.

In opposing a special session, the House Republicans find themselves in rare agreement with House Speaker Michael E. Busch, a Democrat. Busch said yesterday that he, too, wants Maryland residents to have ample opportunity to express their views during the legislature's debate over the governor's budget package.

"I told the governor personally that I wasn't going to publicly support a special session," Busch said. "That hasn't changed."

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