Tax Plan

The recent House oversight hearing showed, among other things, that notwithstanding White House assertions to the contrary for almost two weeks, there was no public demonstration whatsoever outside the Benghazi Consulate on the night of the Sept. 11 attack and that within 24 hours of the attack, it was recognized by some in the White House to have been a terrorist inspired and executed attack ("Testimony: Calls for aid were denied," Oct. 11). It was also revealed at the hearing that the U.S. State Department denied repeated requests to improve the security of our diplomatic stations in Libya.

ANNAPOLIS -- After stoking the engine with enough goodies to assure that a full crew would be aboard, the Senate's tax train unexpectedly chugged right off the tracks yesterday, even before it had cleared the station.By a 7-6 vote, the Budget and Taxation Committee killed -- for now, at least -- a bill that would have raised $430 million in new taxes by increasing and expanding the state's 5 percent sales tax, and by increasing taxes on cigarettes, alcoholic beverages and long-distance telephone service.

Herman Cain is surging. Who is this guy, and how did he come out of virtually nowhere to suddenly lead the Republican presidential primary field? Perhaps Mr. Cain is just a passing fancy, the party's and the pundits' flavor of the month. Although several national polls show him now leading prohibitive favorite Mitt Romney, the conventional wisdom is that Mr. Cain doesn't have the resources, political chops or connections to the Republican establishment needed to capture the nomination.

The gas tax plan unveiled this week by Gov. Martin O'Malley and the General Assembly's top leaders is a complicated proposal that wouldn't represent our first choice in how best to pay for Maryland's transportation needs. But, on balance, it's a better-than-expected solution to a problem that has been nagging the State House for two decades. Better than expected because efforts to increase the gas tax have been practically dead on arrival in Annapolis for years, thanks to high prices at the pump and public hostility toward anything that might raise them further - even as alternatives like vehicle registration and licensing fees hit Marylanders harder than a few pennies on the gallon would.

A budget plan moving through the House of Delegates calls for an income tax increase of less than half the size of the hike passed by the Senate last week and would spare taxpayers who make less than $100,000. A House committee approved amendments Monday to the Senate tax bill that would have raised about $473 million in order to avoid deep cuts to programs suchh as education and health. But the House plan calls for deeper spending reductions and would raise about $200 million in new revenue each year.

ANNAPOLIS -- Unable to agree on taxes, Maryland lawmakers shifted their attention back to the state budget yesterday, hoping they can at least get that approved before the 90-day session expires at midnight Monday.But even that effort fell apart last night.House and Senate conferees on the budget abruptly decided there was no sense in meeting because the House wanted nearly $50 million in appropriations for expanded local aid programs, while the Senate conferees did not.The aid would include a $30 million grant to Baltimore and five poor rural counties, and would provide $17 million to finance educational placements for disabled students.

Next year, I'll raise the personal exemption on the state income-tax form from $1,200 to $2,200 and wipe out the 2 percent tax Marylanders pay on their first $1,000 of income. In succeeding years, I'll cut the top tax rate to 4 percent. These cuts will bring much needed relief to families and low-income wage earners.To my opponent, this seems a horrifying prospect. When he isn't shamelessly misrepresenting my plan or saying it's impossible, he's imitating Chicken Little, proclaiming the sky will fall if we exercise the spending restraint required to implement it. I'm not surprised at the overblown rhetoric.

The death knell for the Schaefer administration plan to raise $800 million annually by restructuring state taxes could come this Friday when legislative analysts unveil a report criticizing the plan as harsh on low- and middle-income taxpayers.Even Lt. Gov. Melvin A. Steinberg, the governor's chief liaison with the legislature, agreed yesterday that the so-called Linowes proposal is likely to see summer study by lawmakers."Bills that are this complex and complicated need a period of gestation," Steinberg said.

A gaping budget gap awaits Gov. Martin O'Malley and Maryland lawmakers when they return to Annapolis this month — a problem that persists even after three years of recession-driven trimming and now amplified by the evaporation of federal stimulus aid. But fresh from re-election to four-year terms, officials have the political capital this year to make unpopular choices. O'Malley, a Democrat who campaigned heavily on his commitment to education and secured the backing of the state's largest labor union, is considering cuts to schools and reductions to the state work force.

WASHINGTON - Hoping to reclaim some momentum for his sweeping tax-cut package, President Bush insisted yesterday that any short-term tax relief to come out of Congress be linked to his own 10-year, $1.6 trillion plan. "Immediate tax relief is good news," Bush said in a speech in Kalamazoo, Mich. "But tax relief that gets yanked away next year is not such good news. Lower rates do not stimulate much economic activity unless people can rely on them for years down the road." In what aides heralded as a major speech on the state of the economy, Bush continued to offer a generally gloomy portrait, pointing to slowed growth and a steady decline in the stock markets.