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WBAL 1090: State Board Projects Up To $1.1B Tax Revenue Shortfall

Maryland could see a $1.1 billion revenue shortfall in the current fiscal year alone due to the economic slowdown caused by the coronavirus.

“Now is not the time for governments to be reaching into people’s pockets and taking their cash,” Comptroller Peter Franchot said.

Maryland Board of Revenue Estimates Director Andrew Schaufele presented two scenarios at the board’s non-voting, virtual meeting.

The first outcome would include a $1.1 billion shortfall in fiscal year 2020, a $2.6 billion deficit in fiscal year 2021, and an almost $4 billion decline in fiscal year 2022. This estimate assumes a COVID-19 vaccine will exist by fall 2021, and the state doesn’t have a second wave of coronavirus causing another economic shutdown.

The current fiscal year runs through the end of June.

The second scenario factors in receiving more help from Congress through the Paycheck Protection Program to help small businesses keep employees on payroll and other less severe economic assumptions. Under this scenario, Maryland would face a $925 million shortfall in fiscal year 2020, $2.1 billion in fiscal year 2021, and $2.6 billion in fiscal year 2022.

"As Mr. Schaufele's analysis amplifies, what we are experiencing is a snapshot of an economic nightmare. These revenue figures, along with the number of unemployed Marylanders and businesses on the verge of closing their doors permanently, are unprecedented in their scope and magnitude,” Franchot said.

These projections are designed to help Gov. Larry Hogan and the Maryland General Assembly make financial decisions going forward.

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