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November 9, 2007

House Plan: Combined Reporting, Higher Corporate Income Tax, Sales Tax on Repair Services

The House of Delegates is moving their version of the tax package today. Key elements include:

  • Imposing mandatory unitary combined reporting.
  • Increasing the corporate income tax from 7 percent to 8.75 percent.
  • Increasing the individual income tax for Marylanders earning more than $125,000
    • 5.25 percent for individuals earning $125,000 and joint filers earning more than $175,000.
    • 5.5 percent for individuals earning $150,000 and joint filers earning $200,000.
    • 5.75 percent for individuals earning $200,000 and joint filers earning $250,000.
  • Increasing the sales tax from 5 percent to 6 percent
  • Increasing the hotel room rental tax from 5 percent to 10 percent
  • Expanding the sales tax to cover repair services
Repair services include:
  • Laundering, cleaning, mending, altering, and fitting of clothing and other textiles
  • Shoe repair
  • Furniture, rug, carpet and upholstery cleaning and repair
  • Computer and office machine repair
  • Motor vehicle and boart repair of all types, but not including roadside assistance services
  • Electrical and electric maintenance and repair of all types
  • watch, clock and jewelry repair
  • Repair and maintenance of any other tangible personal property

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