Bridget Reed Morawski
WASHINGTON (WMAL) — After a weak holiday shopping season and a flurry of snow storms, the state of Maryland won’t be generating as much tax revenue as it had anticipated.
With a relatively high unemployment for the state of Maryland at 5%, combined with a general trend of consumers cutting costs, sales-tax driven state revenues were lower than expected.
The Maryland Board of Revenues Estimates is projecting general-fund revenues over the next two years to be $51.4 million lower than the $33.5 billion estimated in December.
The board had revised its December numbers after accounting for lottery sales, estate-tax revenue, and corporate income-tax collections, all of which contributed higher than usual revenues and offset a portion of the lower sales tax revenue.
While Republican Gov. Larry Hogan talks of tax cuts amid the finalization of the fiscal 2017 budget, Maryland state comptroller Peter Franchot recommends everything in moderation.
“Let’s keep everything we do, either spending increases or spending decreases, keep them as modest as possible,” said Franchot. “Give businesses and consumers some stability and predictability.”
Franchot predicts that going slowly for the next six to twelve months will allow to state to bounce back from the sluggish state sales tax revenues.
“I think we’ll see the state get up and prosper like we’re accustomed to,” said Franchot.
Copyright 2016 by WMAL.com. All Rights Reserved. (Photo: Pixaby)
