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WFMD: Md. Faces Tax Revenue Shortfall Due To COVID-19 Pandemic

Annapolis, Md (KM). The COVID-19 pandemic is having an impact on Maryland’s finances. The Board of Revenue Estimates is projecting a more than $1-billion deficit for fiscal year 2020, which ends on June 30th, as well as an over $4-billion decline in fiscal years 2021, which begins July 1st, and fiscal year 2022.

“We’ve had 400,000 Marylanders lose their jobs in the last six weeks. So it’s been a nose dive as far as the economy,” says Comptroller Peter Franchot. “But we are doing a little bit better than some other states as far as the tax revenue coming in.”

He says the Board of Public Works, which consists of the Governor, the Comptroller and the State Treasurer, will probably need to make some adjustments to the state’s budget. “There will be surgery done on the fiscal year we’re ending on July 1st, and then the fiscal year that starts July 1st, and goes for 12 calendar months, that’s going to have to be examined very carefully to,” says Franchot.

But Franchot says he’s hoping Congress will pass a stimulus which will provide assistance to the states. “If the federal government gave Maryland hundreds of million or a billion dollars or more to offset some of the revenue losses we’re anticipating, that would be terrific. They should do that. They should do that for other states also,” he says.

If the stimulus bill passes, the scenario forecast for Maryland would $925-million in revenue loses for fiscal year 2020; $2.1-billion for fiscal 2021; $2.6-billion for fiscal 2022. If that doesn’t happen, the scenario is $1.1-billion shortfall in fiscal year 2020; $2.6-billion in fiscal year 202′, and nearly $4-billion in 2022.

The times look grim, but Franchot says there is a silver lining: Maryland is a wealthy state and will be able to weather this storm. “We’re going to have a reconstruction of our state’s economy. We’re going to lose a lot of small businesses, but we’re going to hopefully adopt policies that promote the development of new, innovative, entrepreneurial small businesses. That’s where we get most of employment. That’s where we get most of tax revenue,” he says.

http://www.wfmd.com/2020/05/16/md-faces-tax-revenue-shortfall-due-to-covid-19-pandemic/


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