Republican gubernatorial nominee Larry Hogan told veterans Wednesday that he would eliminate the state income tax on military pensions if elected.
“This tax is not only bad economic policy, it’s also unfair to the men and women who have served our state and fought for our nation. You earned this tax break,” Hogan told members of the Maryland Department of the American Legion at their annual convention in Ocean City.
“On day one we’ll get to work on this,” he said. “And with the support of the 450,000 Maryland soldiers, sailors, airmen and Marines standing behind us, I’m confident we'll even be able to convince the tax-and-spend politicians in Annapolis that it is the right thing to do.”
Hogan’s campaign estimated that eliminating the tax would cost the state $40 million in revenue. Spokesman Adam Dubitsky said the loss would be offset by the large numbers of veterans whom it would allow to remain in Maryland.
“By keeping money in veterans' pockets it will support local businesses and increase local and state government revenue,” Dubitsky wrote in an email.
He added that state audits have shown nearly $2 billion in waste, fraud and abuse, the savings from which would more than offset the tax cut.
Lt. Gov. Anthony Brown, the Democratic nominee for governor, has also proposed a tax break for veterans.
Brown, a colonel in the Army Reserve who earned a Bronze Star in Iraq, said during the Democratic primary campaign that he would eliminate the state income tax on military pensions up to $150,000.
Brown, who announced his plan last November, said he would phase the cut in over eight years. His campaign estimated the loss of revenue by July 2018 at $17.5 million annually.
Brown’s campaign did not respond to a request for comment.