Maryland Senate passes bill to save taxpayers $1.2B in first response to Trump tax reform

In the first of what is expected to be a series of moves in reaction to President Donald Trump's tax plan, the Maryland Senate on Tuesday passed a bill to prevent state taypayers’ bills from rising $1.2 billion next year.

The legislation would ensure that Marylanders can continue to take personal exemptions on their tax returns even though a new law Trump signed in December eliminates that break on federal tax returns.

It is the least controversial of a host of reforms state officials are considering to prevent state tax bills from rising by hundreds of millions of dollars.

The Senate passed the bill unanimously; similar legislation sponsored by a majority of delegates is pending in the House.

The state Bureau of Revenue Estimates had calculated that if Marylanders could no longer take personal exemptions on their state returns, the state stood to collect an additional $730 million in tax revenue, while local governments would gain $490 million. Without the exemptions, the amount of taxable income in the state would rise.

Still, even if the personal exemptions are preserved, Marylanders’ tax bills stand to rise by more than $400 million if lawmakers do not step in to preserve tax deductions eliminated on the federal level. Gov. Larry Hogan and the Democrats who lead the General Assembly have pitched dueling plans to return that money to taxpayers.

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