Will Upton

ATR Urges Virginia Candidates to Support Repeal of Gov. McDonnell's Tax Hike

Posted by Will Upton on Thursday, May 16th, 2013, 4:10 PM PERMALINK

Today, Americans for Tax Reform issued an open letter to candidates for state office in the Commonwealth of Virginia asking them to support the repeal of Governor Bob McDonnell's $5.9 billion tax hike. With the state Republican Convention kicking off this weekend, it is important for delegates to know where their candidates stand on Gov. McDonnell's massive tax hike - the largest in Virginia history.  Click here for a PDF copy of the letter. 

May 16, 2013

Dear Candidate,

Just a few days ago, Governor Bob McDonnell signed into law the largest tax increase in the history of the Commonwealth of Virginia. With a price tag of at least $5.9 billion, the tax hike will undeniably harm Virginia’s economy, meaning less money in taxpayers’ wallets and less jobs for Virginians seeking work. I urge all candidates for state-wide office and the House of Delegates to support the repeal of this onerous burden on taxpayers. 

A coalition of spending interests and their political allies – including Governor Bob McDonnell, Speaker Bill Howell, Senate Majority Leader Tommy Norment, Senate Minority Leader Dick Saslaw, and Senator Frank Wagner – are working hard to fleece the taxpayers of Virginia. The repeal of HB 2313, Governor McDonnell’s tax hike, would send a message to Virginia voters and taxpayers that you are serious about protecting their interests, not the special interest spending lobby in Richmond. 

With the tax hike now law, Virginians will see hikes in their diesel fuel taxes and the gas tax will rise with higher gas prices and inflation. Residents of Northern Virginia and Hampton Roads will see increases in the local sales tax from 5 to 6 percent and Northern Virginia will see additional increases in taxes on homes sales, and increased hotel taxes. The rest of the state will experience a sales tax hike from 5 to 5.3 percent. Eventually, every region of Virginia could be subject to a 6 percent sales hike.

In addition, the legislation puts into place a regime set to collect internet sales taxes if Congress passes the Marketplace Fairness Act – currently in the House of Representatives. If Congress is unable to pass an internet sales tax bill, Virginia residents will see fuel taxes raised even higher to make up for the promised tax collections. Even worse, the Marketplace Fairness Act would subject Virginia’s small businesses to over 9,000 taxing jurisdictions in all fifty states.  Imagine a small business man from Virginia having to appear in a tax court in cash strapped California or Illinois.

In the end, Governor McDonnell’s tax hike is nothing more than a transfer of money from the taxpayers pocket to the spending interests in Richmond. The tax hike must be repealed. 

This burdensome and economically destructive tax hike won’t relieve congestion on Virginia roads, it won’t pave Virginia’s roads, and it won’t fill the pot holes. It will line the pockets of the spending interests and lobbyists in Richmond. This tax hike must be repealed. 

As a candidate for elected office in the Commonwealth of Virginia, I urge you to publically call for and work to repeal HB 2313, Governor McDonnell’s $5.9 billion tax increase. 


 Grover G. Norquist


Americans for Tax Reform

Click here for a PDF copy of the letter. 

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New Tobacco Tax Hike One of Many Shards of Glass in Obama Budget

Posted by Will Upton on Friday, April 5th, 2013, 4:04 PM PERMALINK

Though the President will not officially release his 2014 budget plan until next Wednesday, details of the plan are already starting to materialize.

Leaked on the day Bureau of Labor Statistics revealed job creation in March was less than half of what economists had expected, the plan is expected to outline a bevy of crippling tax increases.

Notably, the President is proposing once again to fund expansions of federal programs through tax hikes on tobacco products.

The plan will propose an increase in the federal excise tax to fund an expansion in pre-k programs. Without details, it is impossible to know what kind of price tag this proposal carries. However, the progressive Center for American Progress has estimated such a program could cost $100 billion over ten years.

The Congressional Budget Office estimated last year that a 50 cent increase on cigarettes would net less than half that amount in new revenue. What's more, one only needs to look to the states to see that tobacco taxes are a declining revenue source. Washington, D.C. raised its cigarette tax by $.50 in 2009 only to see an 11 percent net decline in cigarette tax revenue. South Carolina added $.57 to each pack of cigarettes in July 2010. Despite the rate increase, records show a decline in cigarette tax revenue in South Carolina since that time.  With tobacco tax revenue showing steady signs of permanent decline, tobacco taxes just act as placeholders for future tax increases.

It is important to note that these overwhelming costs would hit the populations least able to afford it. A tobacco tax falls squarely on the shoulder of lower-income Americans. With millions of Americans either unemployed or under employed, it is important to remember that this is a tax increase that will hit people making on average only $36,000 a year.

This is just one in what will be a litany of proposals to increase the size of government. We'll have the full rundown of the President's proposal when it is finally released.

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ATR Applauds Virginia Pledge Signers

Posted by Will Upton on Friday, February 22nd, 2013, 5:39 PM PERMALINK

Americans for Tax Reform would like to applaud the 18 Taxpayer Protection Pledge signers in the Virginia House of Delegates who stood firm against a $6.1 billion tax increase. These lawmakers serve as an example of what legislative leadership looks like. When presented with a bill that was a massive tax increase, that was not posted online for the people of Virginia to see, these 18 lawmakers stood for what was right and said no to HB 2313. 

The 18 Pledge signers who kept their Pledge are as follows:

Robert Bell (H-58)

Kathy Byron (H-22)

Ben Cline (H-24)

Mark Cole (H-88)

Barbara Comstock (H-34)

C. Todd Gilbert (H-15)

Greg Habeeb (H-8)

Tim Hugo (H-40)

Steve Landes (H-25)

Scott Lingamfelter (H-31)

Robert G. Marshall (H-13)

Israel O’Quinn (H-5)

Chris Peace (H-97)

David Ramadan (H-87)

R. Lee Ware, Jr. (H-65)

Michael J. Webert (H-18)

Tony Wilt (H-26)

Tommy Wright (H-61)

Americans for Tax Reform and taxpayers across the Commonwealth of Virginia thank you.

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Virginia Transportation Tax Hike Live Blog

Posted by Will Upton on Friday, February 22nd, 2013, 12:02 PM PERMALINK

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ATR Statement on Virginia Transportation Plan

Posted by Will Upton on Tuesday, January 8th, 2013, 5:37 PM PERMALINK

Virginia Governor Bob McDonnell’s latest transportation funding proposal gets some things right: it begins to prioritize transportation spending while eliminating the gasoline tax.

But the truth is that most Democrats and too many Republicans in the legislature do not share Gov. McDonnell’s prioritization of Virginia’s transportation needs. Surprisingly, many of those opposed to making transportation a real priority hail from Northern Virginia and the Tidewater region, where transportation problems are most acute.  The pressure imposed by these intransigent legislators has so far prevented a plan that addresses Virginia’s transportation funding problems in a fiscally sustainable manner and does not grow the overall tax burden.

The plan as it stands now fails in its goal to prioritize transportation spending while avoiding tax increases.  In the coming days, taxpayers expect legislators to work to protect Virginia families.  To achieve a transportation funding bill that rejects tax increases, Americans for Tax Reform recommends the following:

  1. Lower the size of the new additional sales tax component intended to replace the gas tax to one that avoids tax increases on Virginians;
  2. Include the termination of the diesel tax along with the state gas tax;
  3. Either eliminate the $15 car registration “fee” increase or accurately include its new revenues as taxes and reduce taxes elsewhere;
  4. Further prioritize state spending by allocating a greater share of General Fund revenues toward Virginia’s infrastructure needs, as the Governor has repeatedly proposed, notwithstanding the obstinate refusal to date of a handful of anti-taxpayer Republicans in the senate to support this sustainable approach.

At the same time, there is the danger that this plan could become an even worse deal for Virginia taxpayers as it moves through the legislative process. In the past, particularly in the senate, anti-taxpayer Republicans like Sen. Maj. Leader Tommy Norment, Sen. Frank Wagner, and Sen. John Watkins have worked with Democrats to hijack sound, tax-neutral, pro-growth transportation funding proposals to turn them into tax hikes to fund their pet projects.

By their actions, this tax-increase cohort has repeatedly told Virginians that transportation funding is their lowest priority.  By funding everything else the government does first, leaving no room left for basic transportation needs, these members’ actions reveal what their rhetoric obscures.  They will only meet this core function of government after every spending interest in Richmond is served.

Since Mark Warner’s dishonesty some three governors ago (running against tax hikes and misstating Virginia revenues to promote them), these members have conspired to scuttle any real reform in transportation funding, instead raising taxes that somehow never reach their stated target.  Meanwhile, years later, the structural hurdles that facilitate the raiding of Virginia’s revenues for other purposes continues unabated.  More tax increases simply cannot solve Virginia’s transportation problems—only statutory (or constitutional) reform that allows proper allocation of its resources can keep Virginia moving without sacrificing its engine of economic growth.

This session, Americans for Tax Reform hopes that Senators Norment, Wagner, and Watkins will this time work with their Republican colleagues in the house and senate to craft a sustainable, plan which addresses Virginia’s transportation needs and is not a Trojan Horse for higher taxes.

The fact is Virginia does not have a revenue problem; it has a problem prioritizing spending.

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Tonight: Democrat National Convention to Showcase Tax Hiking Governors

Posted by Will Upton on Tuesday, September 4th, 2012, 4:32 PM PERMALINK

On the opening day of their national convention, Democrats have chosen to showcase three governors who have a long history of pushing job-killing tax hikes on their respective states: Illinois Governor Pat Quinn, former Virginia Governor Tim Kaine, and Maryland Governor Martin O’Malley.    

Illinois Governor Pat Quinn, who kicks off the evening of tax hikers, has had a long love affair with tax increases.  In May of 2009, Gov. Quinn proposed a 50-percent income tax hike, increasing the income tax rate from 3-percent to 4.5-percent.  The proposed tax hike would have taken about $4 billion from Illinois’s private economy near the peak of the state’s recession.  Thankfully, the tax hike failed in the legislature. 

In March of 2010, Gov. Quinn took another stab at hiking taxes, this time proposing a 33-percent, $3 billion tax hike.  It also failed. 

In July of 2010, the Illinois budget director David Vaught let slip a proposed “secret” 67-percent income tax hike being pushed by the Governor.  Gov. Quinn scrambled to distance himself from the comment and denied the proposal. 

Finally, in January of 2011, Gov. Quinn got his wish and signed into law a whopping 66-percent income tax hike, draining $6.8 billion out of the private economy.  The tax hike tagged an extra $1,000 to the bill for a family of four earning $50,000 a year.  Additionally, Gov. Quinn was able to hike the corporate income tax rate – driving more business and jobs from the state.  This year, Gov. Quinn signed into law a 102-percent tax increase on cigarettes.  

Gov. Quinn has repeatedly shown that he is more interested in hiking taxes on struggling Illinois families and businesses, rather than getting the state’s poor fiscal house in order.  The state reportedly has the worst budget deficit in the nation, operating $43.8 billion in the red.  

After Gov. Quinn comes the former Governor of Virginia and current U.S. Senate candidate, Tim Kaine.   As governor, Kaine picked up where his predecessor Mark Warner left off, pushing for higher taxes.  He attempted to raise the maximum state income tax rate from 5.75-percent to 6.75-percent.  The proposed hike would have hit Virginians making as little as $17,000 a year.  Over his whole term as governor, Tim Kaine proposed roughly $4 billion in new taxes – thankfully the state legislature did not see eye-to-eye with Kaine on the tax hikes. 

Capping off the night of tax hiking governors is current Maryland Governor Martin O’Malley.  Gov. O’Malley has become especially fond of tax increases as opposed to spending restraints.   A 2011 study by the National Governors Association and the National Association of State Budget Officers showed Maryland to have the fastest growing state budget in the Mid-Atlantic and the seventh highest budget growth in the nation. In 2012 Maryland’s budget was the fourth fastest growing in the nation.  To pay for Maryland’s spending explosion, Gov. O’Malley has proposed and signed into law a bevy of tax hikes. 

Since 2007, Gov. O’Malley has raised taxes by $2.2 billion, driving 232,000 taxpayers from the state of Maryland and roughly $13 billion in income with them.  

During the Special “Tax Hike” Session in 2007, Gov. O’Malley signed into law a $603.4 million sales tax hike, a doubling of the state cigarette tax from $1 per pack to $2, a $191.3 million income tax hike with the new rates set at 4.75-percent and 5.5-percent, and a corporate income tax hike from 7-percent to 8.25-percent.  

When the 2007 tax hikes failed to generate the desired revenue, Gov. O’Malley signed into law a special “Millionaires Tax” during the 2008 general session. This tax hike pushed the top marginal income tax rate from 5.5-percent to 6.25-percent – a $154 million tax hike. 

With the state still operating with a structural deficit of over $1 billion, Gov. O’Malley signed into law a slew of a new tax hikes during a 2012 special session.  A “Millionaires Tax” 2.0 was passed and signed, increasing income taxes on individuals making over $100,000 and couples making over $150,000.  Additionally a $5 million tax hike on smokeless tobacco and “Little Cigars” was signed into law as well as the elimination of some personal exemptions to the income tax.  

It’s no wonder that a state burdened with ever increasing taxes and out-of-control spending was found to be one of the worst places to retire.  

Keep in mind tonight that these Governors are considered rising political stars and leaders in the Democrat Party.  To most Americans, their tax hikes, both enacted and proposed, would have dire financial consequences.  They have unleashed fiscal havoc on their states, yet we are told to believe that they are reasonable leaders.  While Gov. Quinn looks to have hit his political ceiling as Governor of Illinois, Gov. Kaine is looking to bring his tax and spend liberalism to the U.S. Senate and Maryland Gov. Martin O’Malley has his eyes on a 2016 presidential run, hoping to turn the rest of the United States into the over-taxed and broke State of Maryland. 

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Oklahoma's Intangible Property Tax Problem

Posted by Will Upton on Thursday, August 23rd, 2012, 5:11 PM PERMALINK

Besides choosing their elected officials this November, Oklahoma voters will have to make an important decision on State Question 766, deciding whether or not intangible property will receive a tax exemption.   A quick hint, if SQ 766 passes it could fuel further job growth and innovation in the state.  If the ballot measure fails it could cost Oklahoma businesses precious resources in a stagnant economy and lead to new rounds of layoffs. 

Until a 2009 State Supreme Court ruling, some Oklahoma businesses were “centrally assessed” by the State Board of Equalization while others were “locally assessed” by county assessors. Those that received local tax assessments were generally exempt from paying taxes on intangible property, while “centrally assessed” businesses had to pay taxes on intangible property.  Now small and large businesses alike would be forced to pay property taxes on the value of their customer lists, contracts, philanthropy and goodwill, patents, and trademarks. They'd even pay property taxes on advertising.

AT&T sued the State of Oklahoma over taxes they paid on intangible property per their assessment from the State Board of Equalization. They lost the case when the Oklahoma Supreme Court ruled that “locally assessed” businesses were not exempt from the tax, effectively extending the tax on intangible property to all Oklahoma businesses.  SQ 766, which stems from the Supreme Court ruling, seeks to remedy the new tax regime on intangible property – almost no other states tax intangible property.  

The extension of a tax on intangible property to almost all Oklahoma businesses could cost employers hundreds of millions of dollars. 

If SQ 766 passes, it would stave off a possible economic disaster for the state.  With an uncertain tax regime and assessments on ideas and innovation, businesses would flee the state.  Exempting taxes on intangible property is paramount to Oklahoma’s full economic recovery. 

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Maryland Governor Martin O'Malley: Barack Obama, Jr.

Posted by Will Upton on Tuesday, May 22nd, 2012, 3:11 PM PERMALINK

Governor Martin O’Malley has transformed Maryland into one of the most hostile places for taxpayers to live.  With new taxes on income and smokeless tobacco passed into law after the May, 2012 special session, Maryland is quickly becoming the most taxed state in the country. 

During O’Malley’s current term in office (2007 to 2010*) 232,000 taxpayers have fled Maryland taking $13 billion in income with them.  

Americans for Tax Reform believes that Gov. O’Malley’s left-wing, tax-and-spend policies in Maryland give the American people an inside look into how Barack Obama will act if he is re-elected to a second term. 

During the 2008 Presidential election, then candidate Obama promised not to raise taxes on any family making less than $250,000 a year.  Without a word of resistance from the President or Maryland’s Congressional Democrats, Gov. O’Malley has moved the goal posts and redefined “rich” as any individual making more than $100,000 – or couples who are making more than $150,000 – a year. 

Below, ATR has compiled a comprehensive list of tax hikes Gov. O’Malley has enacted as Governor of Maryland:  

History of Tax Hikes

2012 Special “Tax Hike” Session:

• Tax hike on smokeless tobacco and “Little Cigars”: $5 million
• Elimination of Telecom Property Tax Credits (Corporate Income Tax): $7.4 million
• Elimination of personal exemptions (Individual Income Tax): $51.7 million
• Income tax hikes on individuals making over $100,000 and couples over $150,000: $195.6 million

2012 Regular Legislative Session:

• Flush tax hike: $53 million

2011 Regular Legislative Session:

• Highway and Bridge toll increases: $90 million
• Vehicle titling tax hike from $50 to $100: $52.4 million
• Hospital provider tax: $390 million
• Alcohol sales tax hike from 6-percent to 9-percent: $84.8 million

2008 Regular Legislative Session:

• The Millionaires Tax pushes top marginal rate from 5.5-percent to 6.25-perent: $154.6 million

2007 Special “Tax Hike” Session:

• Senate Bill 2 - Real property transfer tax hike: $14.1 million
• House Bill 5 – “Tip Jar” tax hike, 20-percent “Admissions and Amusement” tax: $8 million
• Tobacco tax hike from $1 per pack to $2 per pack: $133 million
• Vehicle excise tax hike: $36.9 million
• Vehicle titling tax hike (bumped from $23 to $50): $23 million
• Sales tax hike from 5-percent to 6-percent: $603.4 million
• Income tax hike with new rates between 4.75-percent and 5.5-percent: $191.3 million
• State corporate income tax hike from 7-percent to 8.25-percent: $118.6 million

2007 Regular Legislative Session:

• Eliminated use of captive real estate investment trusts for income tax purposes: $10 million

Additional notes:

• Since taking office in 2007, Maryland Governor Martin O’Malley has enacted 19 major tax hikes amounting to a total of $2.2 billion in tax increases.  

• In that same period of time, Governor O’Malley has increased spending by over $1 billion each fiscal year.

• The National Governors Association and National Associations of State Budget Officers’ 2011 fiscal study of the states shows Maryland to have the highest rate of budget growth in the mid-Atlantic region and 7th overall nationally.  

• In the past year Governor O’Malley has tackled social issues that are important to liberal Democrat voters, including Gay Marriage and the DREAM Act – checking off the requirements for his own presidential ambitions in 2016. 

• Governor O’Malley continues to push for a multi-billion dollar wind farm project off the coast of Maryland that would cause higher costs for utility providers and consumers alike. 

*The IRS has not released tax migration data for 2010-2011.  Governor Martin O’Malley is ineligible to run for reelection in 2014 due to term limits.



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The Post Mortem on Maryland's Special Tax Hike Session

Posted by Will Upton on Friday, May 18th, 2012, 3:48 PM PERMALINK

The Maryland House of Delegates passed the Budget Reconciliation and Financing Act (BRFA) on Wednesday by a 77 to 60 vote – resulting in a $300 million tax increase on Marylanders.   Governor Martin O’Malley will surely sign the bill, checking off another item to impress union bosses and big government liberals with, in a lead up to his 2016 presidential campaign.  

The BRFA extends the concept of the infamous Maryland millionaires tax to single filers making over $100,000 a year and joint filers making over $150,000 a year.  Then candidate Barack Obama promised as President that he would not raise taxes on anyone making under $250,000 a year.  Maryland Democrats have decided to move the goal posts and redefine “rich” as being anyone who makes over $100,000 a year – including many of Maryland’s small businesses and employers.  

Besides increasing tax rates; the BRFA phases out many exemptions at an accelerated pace. Low tax states like Virginia, Florida, and Texas must be looking very appealing to Maryland taxpayers and employers right about now.  

In addition to job killing and population draining income tax hikes, Maryland Democrats managed to insert two tax increases on tobacco.  The tax on “little cigars” will jump from 15-percent to 70-percent of wholesale, and the rate on smokeless tobacco will rise from 15-percent to 30-percent.

The tax hike on smokeless tobacco – defended by Democrat lawmakers because of tobacco’s health implications – flies in the face of actual science.   If Maryland’s lawmakers were really concerned about Marylanders’ health and not finding new sources of revenue, they would not be seeking to create tax parity between smokeless tobacco and cigarettes.  Rather, they would be trying to adopt a policy of Tobacco Harm Reduction.  By increasing the tax on smokeless tobacco, Maryland Democrats are perpetuating the unfortunate and detrimental misconception that the use of smokeless tobacco is as harmful as smoking – and as a result may be encouraging more Marylanders to continue to smoke instead of switching to far less harmful products.  

The fact is, every year under Governor Martin O’Malley, state spending has increased by $1 billion or more.  The supposed “Doomsday Budget” passed at the end of this year’s regular legislative session was anything but “doomsday.”  It was a $700 million increase from the previous year’s budget and left intact all of Maryland’s social programs, education, and government services.  

With the tax increases now in place, the Tax Foundation has calculated that a two child family with a $250,000 income would be paying nearly $18,000 a year in taxes.  That’s almost $1,500 more than in Washington, DC, and $6,500 more than in Virginia.  

If anything, Maryland’s “Doomsday Budget” was actually the BRFA and its bevy of job killing tax hikes.

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Maryland's Special Tax Hike Session Kicks Off Today

Posted by Will Upton on Monday, May 14th, 2012, 10:43 AM PERMALINK

Evidently a spending increase just shy of $1 billion is not enough for Governor Martin O’Malley and the Democrat leadership in Maryland’s General Assembly.  Today, May 14, lawmakers will return to Annapolis to pass the Governor’s tax hike proposal, allowing Gov. O’Malley to increase spending by over $1 billion from last year’s budget.  

Under Gov. O’Malley’s proposal, about one in five Marylanders will see their taxes rise.  WBAL is reporting that the proposal will set new income tax rates on Marylanders making over $100,000 a year. However, there is a potential House-Senate compromise that could lower the threshold to just $75,000 a year.  

Maryland taxpayers, small businesses, and consumers should also be wary of the possibility of a 70-percent tax increase on smokeless tobacco and cigars. These hikes will hurt consumers and employers; driving jobs and small businesses from the Chesapeake Bay State.

When Governor O’Malley signed a new millionaires’ tax into law in 2008, Maryland’s millionaires fled the state – tax returns indicate that one-third of those making over a million dollars left Maryland between 2008 and 2009. Following the millionaire’s tax catastrophe, O’Malley promised to end the state’s $1 billion structural deficit through spending cuts alone, yet he’s back at the tax hiking game.  

Maryland’s budget is a mess. Spending has grown by $1 billion or more each year that Governor O’Malley has been in office.  If the state had capped spending to the rate of inflation and population growth between the years 1999 and 2009, the state would have spent $34.2 billion less, more than enough to wipe out the structural deficit and cut the state’s burdensome tax regime.   Instead, Governor O’Malley hiked taxes by more than $1 billion in 2007, instituted the millionaires’ tax in 2008, and now wants to raise taxes again by over $300 million.  It is self-evident; Maryland has a spending problem, not a revenue problem. 

Eileen Norcross of George Mason University’s Mercatus Center has released an excellent report, “The Appearance of Fiscal Prudence,” explaining how Maryland’s budget process has only exacerbated out of control spending.  The Spending Affordability Committee, a special committee within Maryland’s General Assembly, draws up the budget each year.  The committee’s rules have been cast aside, causing what was supposed to be guidelines instituting a spending cap to now be considered the state’s spending target. 

Additionally, Governor O’Malley has claimed that this budgeting process has created $7.5 billion in spending cuts, but that is just not true.  Again, each year that Governor O’Malley has been in office, the budget has ballooned by $1 billion or more.  A study released by the National Governors Association and the National Association of State Budget Officers shows that Maryland has the highest general fund budget growth among the Mid-Atlantic region, and it ranks 7th overall nationally. 

Americans for Tax Reform encourages Maryland residents and taxpayers to contact their state lawmakers and Governor O’Malley and voice their opposition to ALL the new proposed tax increases.  You can find your legislator here.

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