Bill > SB70

This bill modifies Maryland's county income tax regulations by increasing the maximum county income tax rate from 3.20% to 3.7% and establishing a more detailed structure for income tax brackets. The bill requires counties to set income tax rates using predefined income brackets, with separate brackets for single filers and joint/head of household filers. For single filers, these brackets range from $1 to over $1,000,000, while joint filers' brackets span from $1 to over $1,250,000. Counties are limited to setting no more than eight income brackets and cannot set a minimum tax rate below 2.25%. Importantly, counties can now set a tax rate higher than 3.2% only on taxable income exceeding $250,000 for single filers and $300,000 for joint filers. The bill also stipulates that any revenue generated from tax rates exceeding 3.2% should be used to fund public education and transportation. Counties must follow specific procedures when changing tax rates, including holding public hearings and providing public notice. The changes will take effect on July 1, 2026, and apply to taxable years beginning after December 31, 2026.

Budget and Finance

https://mgaleg.maryland.gov/mgawebsite/Legislation/Details/SB0070?ys=2025RS