Sales Tax

ANNAPOLIS -- Lawyers, doctors and accountants may not escape the larger sales tax net proposed by the Linowes tax commission, Lt. Governor Melvin A. Steinberg warned last night.While Mr. Steinberg said that Gov. William Donald Schaefer has yet to decide which of the commission's proposals to endorse, he told a state bar association dinner last night that lawyers and other professionals may not be exempted from a sales tax on their services, as the commission proposed."There is serious discussion taking place on whether or not we will go with the sales tax . . . and make it include lawyers," he told the group.

After several years of budgetary sleight-of-hand that saw funds transferred from one pot to another to keep the state budget in balance, it is clear that something must be done to deal with an expected $1.5 billion shortfall in next year's spending plan. Despite Gov. Martin O'Malley's efforts to trim spending, it appears inevitable there must be revenue increases. But any tax increases must be distributed fairly and not fall too heavily on those who can least afford them. That means adjusting the income tax, not the sales tax. We can all share a little guilt about the "structural deficit."

An unusual drop in sales tax receipts last month and weakness in other revenues could significantly complicate the already large budget problems state lawmakers face next year, Comptroller Peter Franchot said yesterday. Tax revenues declined by about $20 million last month compared with March 2006 - a drop of about 2 percent, largely because of a 3 percent drop in sales tax receipts. In a letter to Gov. Martin O'Malley and leaders in the General Assembly, Franchot said there is reason to fear the tax numbers could become a trend.

A spokeswoman for Frito-Lay Inc. said yesterday that Maryland will lose a 750-job plant expansion unless lawmakers repeal a 6 percent sales tax on its products.Robbi Rice Dietrich, Frito-Lay's director of government affairs, testified before the House Ways and Means Committee in support of House Bill 83, which would extend to salty snacks a sales tax exemption granted most foods.At stake is a $32 million expansion of Frito-Lay's Aberdeen plant, Ms. Dietrich said. The jobs likely would go to one of the company's plants in North Carolina, New York or Connecticut, she said.

WILLIAMSBURG, Va. - President Bush has signed into law an economic stimulus bill that's too small to be a real stimulus and too late to be of much use. Congress could have enacted legislation of this sort in the fall but for an unseemly political quarrel. Republicans fought for fiscally irresponsible retroactive tax cuts of dubious value in stimulating current spending. Democratic plans, while more balanced toward people of lesser means and the unemployed, weren't (and aren't) well targeted to raise consumption broadly across the economy.

If a proposed new 5 percent motor fuel tax is approved by the General Assembly, some disgruntled tractor-trailer drivers said yesterday they plan to keep on trucking -- driving their 18-wheelers non-stop past Maryland's costly gas and diesel pumps."

It's unfortunate that a majority of Harford's state legislators haverushed to submit legislation giving the county the authority to charge a local property transfer tax -- a fancy name for a sales tax whenyou buy a house.In the hysteria to find new revenue, it seems the legislators turned a blind eye to those to be hardest hit -- the low-income and first-time buyers.The delegation should have demanded a more convincing explanationfrom County Executive Eileen M. Rehrmann as to why she doesn't use the tools at hand to raise money she needs to build schools and preserve farmland: property taxes and bond issues.

ANNAPOLIS -- Hey, listen up! You hot dog dealers and purveyors of assorted carryout treats: You have to start collecting sales tax. The state tax collector's office wants you to start anteing up.Now.If you sell food items that cost at least 20 cents but less than a dollar, or if you run a carryout business that has no seating on the premises for customers, you are now subject to the state's expanded 5 percent sales tax that went into effect June 1.Comptroller Louis L. Goldstein's office has contacted about 30,000 businesses and trade organizations but may not have hit everyone covered by the tax.If you're in that category, you can get a sales tax license from the state (at no cost)

If Maryland is "tax hell," as Money magazine once alleged, then surely its sales tax structure is heaven's reply. A walk down "The Avenue" in Baltimore's Hampden will show you why.Drop off the old Bulova at Heiss Jewelers for cleaning. Slip into Gary's Hair Salon for a trim, maybe even a manicure. If you're feeling really blah, ease into one of the tanning booths at The Hair Bear.Before you head home, pick up your resoled loafers at Hampden Shoe Repair. Get your shirts at Sanitake Cleaners on Chestnut, stop by Tom Lake's repair shop to check on your videocassette recorder and head to Northern Auto, where Bill Sprinkle has finished aligning the front wheels on your 1985 Chevette.

Sometimes the state giveth back.Gov. William Donald Schaefer did just that yesterday by signing into law a bill intended to ease the sales tax burden on small retailers and the companies that supply them.Yesterday's bill was a reaction to a section of the tax law passed in 1992 that was aimed at people who avoided paying sales taxes, especially at large warehouse-type stores. But retailers had complained that last year's tax law created an administrative burden that ended up costing small retailers money, and earned very little for the state.