Wednesday, May 23, 2012
Wall Street Journal editorial, O'Malley's Tutorial: Maryland's Governor Offers a Lesson in Progressive Taxation:
Governor Martin O'Malley is the gift that keeps on taking. Even as he grabs ever more from Maryland taxpayers, he's providing useful instruction in the real purpose and pattern of progressive taxation, which is that sooner or later it comes after the middle class.
Last week the legislature in Annapolis enacted another huge tax increase, this time hitting anyone earning more than $100,000 ($150,000 for couples). This isn't a tax on the 1%. It's a tax on the top 14%.
Readers may recall that when Mr. O'Malley first raised taxes, in 2007, he said he could balance the budget on the backs of the rich. That didn't work out so well. The number of millionaires fell sharply in the state, whether because of the recession or because they sought tax shelters or simply fled to lower-tax states. Revenues came in far below projections, and the deficit forecast ballooned.
So Mr. O'Malley is now going where the real money is—the middle class. The highest state-local combined income tax rate will rise to 8.95% from 8.7% and 7.95% when Mr. O'Malley became Governor, giving Maryland one of the highest rates in the nation. About 300,000 Maryland filers reported six-figure incomes last year. ...
The progressive tax ratchet—the racket—is to pretend government can squeeze more money from the rich than is possible, then spend the imaginary windfall, then when deficits persist claim there's no choice but to raise taxes on the upper middle class and eventually on everyone who has income to tax. This is why Californians making as little as $48,000 pay a tax rate of 9.3%.
Our condolences to Maryland residents who are getting soaked again, but thanks to Mr. O'Malley for this tutorial in progressive government. In a second term, rest assured President Obama will do the same.