This would be the most progressive tax reform and economic recovery plan for Maryland. It is also completely paid for without cutting services.
Today, far too many of our fellow Marylanders are struggling to get by. As such, I’m looking at how we provide long-term and sustainable recovery for every Maryland resident.
In addition to the over 150 detailed policy proposals in my Relief, Recovery, Reform agenda (found on my website — JainForGovernor.com), I will accomplish the following 5 historic items in my “Maryland Now” plan:
- Eliminate the state income tax for 95% of Maryland workers
- Make Maryland the first state to guarantee free public transit for every resident
- Create the nation’s first Guaranteed Jobs Program for anyone struggling to find work
- Legalize Marijuana and Expunge the records of those who have been wrongfully imprisoned
- Make our politics inclusive and accessible by imposing anti-corruption measures
This plan will expand economic opportunities and inclusion for all Marylanders; assist those who either have a job or need a job; help our climate; create hundreds of thousands of new jobs; reduce some of the racial injustices we face; and improve the daily lives of residents in every county across the state.
And unlike most politicians who fail to share the details of their plans — and how they’ll actually pay for them — I’m being as transparent and specific in why my plan is feasible and fully paid for.
(1) Eliminate the State Income Tax for 95% of Maryland Workers
For the 95% of Marylanders who earn a personal income of less than $400,000, my Maryland Now Plan will eliminate your state income tax (for anyone making more than $400,000, your state income tax will remain the same).
Why This Is A Great Idea:
- Saves the average Marylander about $2,000 a year
- Increases your take-home pay and disposable income (and ties into creating more jobs through my Guaranteed Jobs Program)
- Enables greater economic mobility and stability for Marylanders who are struggling to get by
- Strengthens our economy by encouraging more people to move here and retirees to stay here
- Does all this without increasing property taxes
How Will I Pay For This
IN THE SHORT-TERM — to make up for this lost revenue (using publicly available data and statistics collected from the Department of Legislative Services and the Maryland Center on Economic Policy) I will:
- Ensure everyone pays their fair share
This means keeping the state income tax requirement for the top 5% of Marylanders who earn more than $400,000 a year.
This means requiring combined reporting (where companies combine profits from all related companies and be taxed as a unitary business).
This means ensuring out-of-state corporations doing business in Maryland pay their fair share in taxes on goods shipped into our state.
And this means taxing companies making more than $100 million a year generated from their digital advertisements.
2. Increase the Fossil Fuel Fee
- Using the pricing structures proposed in a recent MD House bill — we could start at $15/ton CO2 for non-transportation sources and $10/ton CO2 for transportation sources, with an increase of $5/year with no cap until the net emissions from fossil fuels are zero.
- When we burn coal and natural gas to generate electricity, we don’t pay for the damage these fuels inflict on the climate. This fee would ensure those polluters do and help us tackle the threat of Climate Change.
- Additionally, this will help us raise around $700 million in new revenue.
3. Increase our State Sales Tax from 6% to 7.5% and expand the Sales Tax to include services (not just material goods).
- Since every 1% increase in our current sales tax generates an additional $750 million — and with an expansion of the Sales Tax estimated to bring an additional $2.9 billion — we would not only be able to raise around $4 billion in new revenue, but allow modernize our sales tax code to the times we live in (where most businesses have become more service-oriented).
- The state income tax takes more out of our paycheck than sales tax. As such, most Marylanders would rather pay a little more for goods and services and never pay state income tax again.
- Furthermore, by eliminating an entire tax for 95% of workers, increasing their take-home pay and guaranteeing jobs — in addition to my Relief, Recovery Reform agenda that addresses 150 additional policies (ranging from affordable housing and healthcare to better wages and worker protections) — we can provide sustainable stimulus and relief to families across the state.
4. Legalize the Commercial Use and Taxation of Marijuana.
- This will help us raise an additional $100 million to $200 million in revenue, as well as right the wrongs of past marijuana law enforcement and decades of disproportionate harm to communities of color.
IN THE LONG-TERM: While we can keep the Property Tax and Capital Gains Tax rates the same — the remaining funds needed for this program will come from the new revenue generated from more people moving to our state and more residents remaining in our state.
- According to IRS migration data, the nine states without a personal income tax took in a combined $235 billion in additional annual revenues between 2011 and 2018 due to an increase in residents moving to and staying in those states.
- As such, I would not only be able to fully fund this program in the short-term, but will be able to bring more economic prosperity and sustainability for our state’s future.
(2) Make Maryland the first state to guarantee free public transit for every resident
Public transit should be accessible to all Marylanders and financial barriers should be eliminated. It is estimated that 1 in 4 Marylanders use some form of public transit (primarily to get to work or school). Approximately 45% of Marylanders at least occasionally use the metro. Yet, the average Marylander can spend anywhere from $50 to $100 per year on transit.
Therefore, as part of my Maryland Now Plan, I will make Maryland the first state in the nation to offer free public transit for all residents, everyone from students to retirees.
Why This Is A Great Idea:
- It will help our economy by providing better accessibility to ideas and labor
- It will reduce the cost of living for employers and employees
- It will help students — especially those in underserved areas — get to and from school
- It will benefit seniors and retirees better age-in-place
- It will help low-income residents, many of whom do not have access to private cars, and therefore rely on public transportation to get to their jobs
- It will increase mobility and access in our communities for those in the disability community
- It will play a critical role in combating climate change by making mass transit a more accessible, convenient, and viable alternative to private cars, helping reduce emissions and our state’s overall carbon footprint.
How Will I Pay For This:
- Currently, our state (the Maryland Transit Administration) generates around $150 million per year from “rail and bus fares”.
IN THE SHORT-TERM: To make up for the lost revenue, I propose we raise the tobacco tax by $1 per pack on cigarettes.
- According to the CDC, it is estimated that more than 7,000 Marylanders die an untimely death caused by tobacco use every year. Not only are these preventable, but cost the state more than $2.7 billion in health care bills each year.
- In 2021, the Maryland Legislature passed a $1.75 per pack increase, and increased taxes on various other tobacco products, including e-cigarettes and vapid liquids.
- By raising the per pack price from $7.75 per pack to $8.75 per pack, we can not only raise between $150–200 million in new revenue (to be used for my Maryland Now Plan), but save lives and reduce long-term healthcare costs.
IN THE LONG-TERM: By connecting more people to job centers, linking businesses to their suppliers and customers, and making it easier for employers to attract and retain employees — our state can bring more jobs, education, healthcare and recreation services within every Marylander’s reach. This will strengthen both our local and statewide economies and bring sustainable recovery for generations to come.
(3) Create the nation’s first Guaranteed Jobs Program for anyone struggling to find work
I will make Maryland the first state in the nation to fulfill this promise: If you are unemployed and need a job — you will be guaranteed one.
What’s the problem:
Maryland is consistently ranked as one of the wealthiest states in the United States, but we have failed to combat unemployment. Our labor force consists of around 3.1 million people, but 200,000 are unemployed and struggling to find work.
Oftentimes, people struggle to find employment despite their personal ambition, drive, motivation, and education. Many Marylander’s face a lack of resources, workplace discrimination, and job scarcity, but I will ensure that every Marylander of working-age is capable of obtaining quality jobs.
Why is this the solution:
By having our state government serve as an employer of last resort, we can ensure all unemployed residents in our state have the opportunity to access a decent job with living wages, safe working conditions, healthcare and union protections.
And while this would be the first program of its kind in the United States, my plan will help us:
- Increase our state revenues — with the potential of 200,000 newly employed individuals who will now be able to pay property and sales tax, as well as have greater disposable income to further stimulate the economy.
- Increase employability and economic inclusion for those experiencing challenges or discrimination finding work (including veterans, spouses of those in active-duty, women, those who are LGBTQ+, those with disabilities, those impacted by the justice system and people of color)
- Reduce poverty levels and social safety net costs for all taxpayers
- Improve the overall health and sustainability of our economy
How Will This Work:
To anyone currently eligible to receive unemployment benefits (ie. those who are laid off, furloughed, wrongfully terminated, facing employment discrimination, or actively on the job hunt) — AND any active duty, veteran or spouse who’s struggling to find work — our state government will be an employer of last resort and provide jobs in:
- Infrastructure Repair
- Ecological Restoration
- Agricultural Production and Assistance to Farmers
- Department of Disability Rights
- Correctional Services
- Eldercare and Childcare Services
- Assistance to Veterans
- Clerical/Administration (Medical, Housing, Transportation, Nursing, Education)
- Multilingual Support
- Public Art Programs
- Clean Energy Projects
While these important jobs won’t be competing with jobs in other industries — and provide infrastructure and standard of living improvements for all taxpayers — they will be available to all those actively seeking employment and provide them an immediate opportunity to get back on their feet.
We will also guarantee these jobs for as long as individuals are able to perform their duties, and we will work with the non-profit and private sectors to create pathways for employment of these new workers. Adequate training and support for those involved in this program will also be provided.
How Will I Pay For This
I will accomplish this goal by expanding the Maryland Unemployment Insurance Payroll Tax.
The Maryland Unemployment Insurance Payroll Tax (also known as UI or SUTA) requires employers to withhold a certain percentage of their employees’ taxable incomes to pay into the Maryland Unemployment Insurance Trust Fund (which is separate from the Maryland general revenues or any other state fund).
Using publicly available data and statistics collected from the Department of Legislative Services, the Maryland Center on Economic Policy and the SBA Office of Advocacy, we know that Maryland employers withhold anywhere from 2.2% to 13.5% on the first $8,500 that each employee earns per year (with many exemptions and loopholes). This applies to employers who pay wages of at least $1,000 during a calendar quarter and are not tax exempt.
By instituting a flat UI withholding of 2.9% for our small businesses (classified by the SBA as those who employ less than 500 employees) and 3.9% for our large businesses (classified by the SBA as those who employ more than 500 employees) — with no additional exemptions or loopholes, and with guarantees that they will not reduce earnings — we will be able to:
- Provide a much lower UI tax ceiling than the current max of 13.5%
- Prevent UI tax increases for employers in the future
- Raise about $6 billion in additional revenue
The cost to provide a decent job paying $30,000 a year — one that does not compete with other industries (who pay a median yearly salary of $35–40K), pays more than the weekly unemployment insurance wages (which can go up to $430 a week, for up to 39 weeks), and includes salary and benefits — for the approximately 200,000 Marylanders looking for work would be around $6 billion.
As such, I’m able to fully fund this program, replace the need to provide weekly unemployment insurance wages with real jobs, help people struggling get back on their feet, and help our state finally achieve full employment — with more taxpayers contributing to our state revenues.
(4) Legalize Marijuana and Expunge Records
Possession of 10 grams or less is already decriminalized in Maryland(so you can’t be penalized criminally). But I want to expand this to make total possession (regardless of quantity) decriminalized, as well as make it legalized (to make it fully accessible and taxable).
Marijuana has proven to be significantly less dangerous than alcohol, cigarettes and other drugs/opioids. As such, I believe in legalzing it to generate significant revenue for our state, as well as to provide more racial justice in our criminal justice systems (since Black residents are arrested at higher rates and given harsher sentences than white residents for possession).
Part of this process will also be to expunge records from MVA files, police files and court files.
Additionally, by beginning/increasing cultivation to arable land in locations like Frederick county, the Upper Eastern Shore and even urban farms in Baltimore City, we can boost our agriculture sector and increase revenues for our local and state economy. And to offset some of the very high production costs and ensure more small farmers are able to participate in this economic opportunity, we could expand Enterprise/Opportunity Zones (which include tax credits and incentives) to farmers who participate.
(5) Make our politics accessible by imposing anti-corruption measures
I believe decisions about us should not be made without us. That’s why:
- My entire campaign is crowdsourced and all our events are free;
- I refuse donations from corporations — and will use public financing;
- I will ban the Governor, Lt. Governor and agency heads from personally owning a business or stocks (retirement savings are exempt) while in office;
- I will ban the Governor, Lt. Governor and agency heads from serving on for-profit corporate boards while in office;
- I will impose a 4-year lobbying ban for the Governor, Lt. Governor and agency heads after they leave their positions.
For more information about the Jain campaign, visit JainForGovernor.com