Friday, August 26, 2005

Tax Cuts Inappropriate

from The League: Reassembled with revisions

The day after state Comptroller William Donald Schaefer announced Maryland ended fiscal year 2005 with a $1.2 billion surplus, Democrats and Republicans alike are joining Governor Ehrlich in banging the drum on the march towards tax cuts. According to The Baltimore Sun report, the Governor's "office reaffirmed yesterday that he hoped to return some money to Marylanders through a tax reduction. The most likely offering: a reduction in the state portion of property taxes, which was raised an average of about $120 yearly for a single-family home during the governor's first year in office."

This is not the time for a tax cut. The Thornton plan, described by the Washington Times as "a legislative mandate to erase funding disparities between wealthy and poor public school districts," remains severely underfunded. Numerous state programs, including Medicaid, have suffered budget cuts over the past two years.

Even Comptroller Schaefer, usually an Ehrlich ally, says the surplus does not warrant a tax break. He notes that the amount of the surplus which has not already been earmarked for spending is $603 million, not $1.2 billion. Last week, The Sun reported that Schaefer said "The time is not right [for tax cuts. Ehrlich] is in favor of it. But he's wrong. He doesn't have that money yet."

Cutting taxes this year would be irresponsible and pre-mature. If there really is a sizeable surplus, the state's first priority should be restoring funding to programs which have suffered cuts in the past few years. Then we can start talking tax cuts.

from The League: Reassembled with revisions

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