There is proposed legislation that is gaining ground that would enable Maryland to offer property and income tax incentives to lure new manufacturing companies to the state of Maryland based on the New York model where they provided 10 year tax deferments to companies that would locate in the state. The unintended consequence is that it could put existing manufacturers out of business, read the Baltimore Sun article: “Some Maryland manufacturers cry foul over bills to boost manufacturing”.
RMI supports All manufacturers. We applaud legislative efforts to attract new manufacturing business to Maryland and we support any and all efforts to expand existing manufacturing companies. The Governor and Senator Manno have made manufacturing a priority and for that we are grateful. While conceived out of a desire to support increased manufacturing jobs in the State of Maryland, we recommend amending SB386 and SB181 and their respective House Bills, to make it fair for all manufacturing companies.
We understand why the preferential tax treatment for companies is being proposed so as to attract new companies to Maryland. However, the reduction/abatement of personal income taxes for individuals working for these manufacturing companies is an incentive that creates a non-competitive situation for current manufacturers. We believe this section of the bills may do more harm than good.
The good news is that Democrats and Republicans support efforts to attract new manufacturers to Maryland. Governor Hogan and Senator Manno introduce bills to grow manufacturing.
The potential bad news is that these bills give employees of new companies coming to Maryland, or existing companies establishing operations inside certain Manufacturing Empowerment Zones ( proposed amendment in SB181), the following incentive: Employees of companies in Manufacturing Empowerment Zones earning $65,000 or less annually, will not pay state income tax for 10 years.
Potential Impact to your company: Your workers may leave for jobs in a Manufacturing Empowerment Zone because employees in these zones pay no income tax for 10 years. Both the Governor’s Office and Senator Manno have said that they welcome input and suggestions from Manufacturers on their bills.
RMI encourages you to make your voice be heard.
Governor’s Bill SB386
Governor’s Legislative Office: 410-974-3336
RMI contact: Chris Carroll
Senator Manno’s Bill SB181