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O'Malley representative: Middle-class tax cuts are critically important

'If Congress doesn't act before the holidays, every family in Hagerstown's taxes will automatically go up'

December 05, 2012|By DAN DEARTH | dan.dearth@herald-mail.com
  • Dana J. Thompson, director of federal relations for the Office of Gov. Martin O'Malley, was the guest speaker at Eggs and Issues on Wednesday morning to discuss the fiscal cliff's economic impact on Maryland and Washington County.
By Yvette May, Staff Photographer

A representative of the Maryland governor said Wednesday that a middle-class family of four could expect to see its annual taxes increase by $2,200 if Congress doesn’t act by the end of the year to avoid the fiscal cliff.

Dana J. Thompson, director of federal relations for the Office of Gov. Martin O’Malley, told about 60 people who attended a breakfast at the Ramada Plaza hotel in Halfway that it was critically important for Congress to extend middle-class tax cuts.

“If Congress doesn’t act before the holidays, every family in Hagerstown’s taxes will automatically go up, including 98 percent of all of those who make less than $250,000 a year, and 97 percent of small businesses that earn less than $250,000 a year,” Thompson said.

The Hagerstown-Washington County Chamber of Commerce invited Thompson to speak at the breakfast.

Typically, the chamber invites two people to give both sides of an issue. On Wednesday, however, Thompson was the only speaker.

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The “fiscal cliff” is the term used to describe the economic problems that the U.S. government will face at the end of 2012, when the terms of the Budget Control Act of 2011 are slated to take effect.

If a compromise between Democratic President Obama and the Republican-held House of Representatives isn’t reached, some of the things that will change include the end of tax cuts for American families, and the beginning of taxes to support the president’s new health care law.

In addition, spending cuts will take effect in areas such as national defense and Medicare.

Thompson said Maryland would suffer from federal spending cuts because federal spending created about 821,000 jobs in the state in 2010.

“Our top employer is a federal installation (Fort George G. Meade),” he said. “We rank fourth total in federal procurement and expenditures despite ranking 19th in population. Furthermore, in 2010, federal operations created close to 25 percent of all the jobs in the state ... It’s made us a federal (research and development) and advanced technology innovation hub.”

Thompson said those cuts would not only hurt the state, but Hagerstown and other cities that rely on federal money to support various programs.

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