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February 8, 2023

According to This Maryland Group, Rich People Don’t Like Taxes

Self-described non-partisan group Change Maryland is convinced the 31,000 individuals who left Maryland from 2007 to 2010 did so due to the state's increasingly burdensome tax rates. Surely it has nothing to do with Pepco's unreliable service, bad traffic, swampy summers, sandy crabs, the proliferation of Natty Boh or any other number of annoyances that might make a person flee the state.

According to the most recent IRS data, tax bases in Montgomery and Prince George's counties shrank by .07 percent and .27 percent, respectively from 2009 – 2010. A Change Maryland report says Maryland lost $1.7 billion of its tax base from 2007 – 2010 as a direct result of the tax-averse exodus.

"In 2007, Maryland passed some of the largest tax increases in history, and I believe a lot of the exodus of taxpayers out of the state has to do with the tax burden," said Larry Hogan, founder of Change Maryland and a former member of Republican governor Bob Ehrlich's administration.

The study says 40% of Maryland's fleeing taxpayers set up camp in Virginia, taking $390 million in taxes with them. The only states who lost more people during the same three year period were New York, California, Michigan, Illinois, Ohio and New Jersey.

Maryland Governor Martin O'Malley has, naturally, come out with a retort, first off calling Change Maryland a "a GOP-led, partisan organization" and second getting really personal, calling Larry Hogan a "a former Ehrlich appointee, failed congressional candidate and failed would-be candidate for Governor." Ouch.

O'Malley claims Maryland has the highest percentage of millionaire households in the United States and says Marylanders have the 3rd lowest state and local tax burden adjusting for income, ahead of only South Dakota and New Hampshire according to the non-partisan Federal Funds Information for States. If that weren't enough to make his point, his office also reminds everyone that when you factor in all of Maryland’s sales tax exemptions, Marylanders pay the 9th lowest adjusted state and local sales taxes in the nation (including adjustments for zero local sales taxes and exemptions on services, gasoline, groceries and more). But wait, there's more! O'Malley's helpful response to Change Maryland's claims goes on to share a 2011 EY report that found Maryland to have the 12th lowest tax burden on new investments and that Maryland businesses pay the 2nd lowest combined state and local taxes as a share of total state and local tax revenue (only Connecticut is lower).

Conclusion? Maybe rich people just don't like the Ravens and obnoxious War of 1812 license plates.


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