Annapolis, MD — As the General Assembly considers the Budget Reconciliation and Financing Act (BRFA), the Maryland Chamber of Commerce offers this statement on Maryland’s economic outlook and urges policymakers to adopt tax policies that support growth and competitiveness.
We recognize the fiscal challenges Maryland faces and we appreciate Governor Moore’s leadership in addressing them. His focus on workforce development, permitting reform and infrastructure investment is vital for Maryland’s long-term success. These initiatives align with our shared vision for a thriving economy that benefits all Marylanders.
The Maryland Chamber shares the Governor’s vision for a competitive economy. However, we are concerned that some of the proposed tax changes under consideration by the General Assembly may have unintended consequences that could hinder business growth and investment. To strengthen Maryland’s economy, it is critical to implement policies that attract and retain businesses rather than inadvertently driving them to neighboring states.
Maryland’s Competitive Position
Maryland’s economy has grown just 3% between 2017 and 2022, significantly below the national average of 11%. With Maryland ranking 31st in overall business competitiveness, 3rd most expensive for business operations and 46th in tax climate, policy adjustments are essential to improve our economic outlook.
Key Tax Policy Considerations
As lawmakers evaluate tax policy changes, we respectfully ask them to consider the following:
- Pass-through entity taxation changes would increase costs for small businesses — family-owned LLCs, S-Corps, sole proprietors, partnerships — potentially limiting their ability to invest, expand and create jobs.
- Combined reporting presents unpredictable outcomes that could reduce tax stability for businesses. State studies have cautioned that this approach could result in revenue losses and create administrative complexity.
- Enterprise zone tax credits have proven effective in stimulating economic development in areas that need it most and should be preserved.
A Collaborative Path Forward
We support Governor Moore’s economic initiatives and are committed to working in partnership to foster an environment where businesses can thrive. Maryland businesses are not seeking loopholes — they are looking for a stable, predictable environment to grow, hire and invest. To foster economic growth, we urge policymakers to:
- Reject pass-through entity tax increases to protect small businesses
- Abandon combined reporting to prevent job loss and instability
- Preserve enterprise zone tax credits that promote economic development
By working together, we can ensure Maryland remains a place where businesses choose to invest, expand and create jobs — driving prosperity and opportunity for all Marylanders.
