Maryland, My Maryland

 Fox 45 News, Maryland's newly passed budget includes more than $1 billion in new taxes and fee

Maryland Governor Wes Moore has officially signed the Fiscal Year 2026 Budget Bill into law. According to Moore, it’s designed to give the majority of Marylanders a much needed tax break. However, critics say any potential savings will be crushed by a wave of tax and fee hikes.

The $67 billion dollar spending plan is about 1% higher than the previous year. Despite the slight increase, lawmakers were aiming to tackle a $3.3 billion dollar deficit this session. They ultimately did so with about $2 billion in cuts and $1.6 billion in new taxes and fees.

The following is a list of some of the changes taxpayers can expect:

• New Vending Machine Tax: 6% sales tax applied to all vending machine purchases.
• Vehicle Excise Tax Increase: Raised from 6% to 6.8% on vehicle purchases. A plan to raise car registration fees will also be accelerated.
• Tire & Emissions Fees: New $5 per tire fee. Plus, the emissions testing fee doubled from $14 to $30.
• Cannabis and Sports Betting Tax Increases: Cannabis sales tax raised from 9% to 12%. Sports betting tax increased from 15% to 20%.
• New Tech Tax: 3% sales tax added to many IT and data services
• New Tax Brackets for Higher Earners: 6.25% for income $500,001–$1 million, 6.5% for over $1 million. Also adds a 2% capital gains surcharge for income over $350,000.

“We have a tax reform plan that for 94% of Marylanders, they either got a tax cut or saw no change,” said Moore at Tuesday’s bill signing.

Unless you buy from vending machines, drive a car, bet, smoke pot, or have someone work on your IT.

Just a reminder, when Gov. Hogan left office in 2022, Maryland was running a $5 billion surplus. At the end of this session, legislators were forced to address a $3.3 billion deficit by making cuts throughout state government and raising taxes and fees.