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McKee's tax cut plans given little chance in House

March 11, 1998|By GUY FLETCHER

McKee's tax cut plans given little chance in House

ANNAPOLIS - Maryland Del. Robert A. McKee, R-Washington, thought he came up with some sensible ways to give older people and students in the state a modest tax break.

One problem: His two proposed tax cuts would cost the state about $12.6 million next year.

For that reason, McKee's proposals have no chance for passage. But he said they are good ideas, so he made his pitch before the House Ways and Means Committee Wednesday.

One bill would eliminate the sales tax for the purchase of textbooks by undergraduate college students. McKee said the idea came from a constituent who paid $27.50 in textbook sales tax on books for one semester of classes.

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The average amount spent by undergraduate students on textbooks was $509 last year, according to state estimates. Another $25.45 is paid through the state's 5 percent sales tax.

"If we're trying to make it easier for them to get into college, there's no reason to tax the textbooks they need to study," he told the committee.

But a fiscal analysis from the Department of Legislative Services found the textbook break would result in $5.3 million in lost revenue next year.

McKee told the committee he planned to research the range of prices for textbooks at an Annapolis college. But he added, "Once I got the fiscal note, I thought that wasn't necessary."

Sensing a halfhearted presentation by McKee, Ways and Means Chairwoman Sheila E. Hixson, D-Montgomery, joked, "That was an emotional appeal the delegate made."

The second bill would increase the annual state income tax exemption for blind and elderly people from $1,000 to $1,400 next year. That would cost the state $7.3 million in reduced revenues, according to the legislative agency.

The exemption would increase to $2,400 by 2002. By then the state would be losing $25.5 million annually, the agency reported.

After the hearings, McKee was blunt about the bills' chances.

"Neither of them have any chance," he said.

But he said the two bills magnify a problem in the state's legislative process, in which financial impact studies are done only after a bill is filed. McKee said he learned how much the two bills would cost when he received both fiscal notes last Friday.

"If I had known that up front, I probably wouldn't have put the bills in," he said.

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