Congratulations, Maryland! According to a story in today’s Post, the Free State leads the country in millionaires. Approximately 7.22 percent of Marylander households are part of the exclusive millionaires club.
There are about 2.4 million households in Maryland, so that translates into roughly 173,000 millionaire households. I’m glad this information was released, because the state is currently considering, and Gov. Martin O’Malley appears to be supporting, a series of proposals to increase any number of taxes — the gas tax, the flush tax, car titling and registration fees, and the auto emissions testing fee. Indeed, the one tax that O’Malley does not seem interested in increasing is the income tax.
A few months ago, O’Malley accused the GOP of “worshipping” tax cuts for the wealthy. That may be, but it’s clear here in Maryland that O’Malley is happy to bow down before the altar of tax increases on the poor and working class.
Now the data on millionaires is specific to families with at least $1 million in liquid assets, but let’s consider questions of income in Maryland — afterall, the higher your income, the more likely you are to accrue $1 million in liquid assets. The median household income in Maryland is $69,000 a year. Under Maryland’s tax schedule, the median household would face an effective tax rate on 4.67 percent. A household earning exactly $1 million would face an effective tax rate of 5.2 percent, earn over $1 million and your effective tax rate slowly approaches a maximum of 6.25 percent.
Nationally, the median income is $50,000 a year. Under the current federal marginal tax rates, the median household would face a tax burden of $6,650 — an effective tax rate of 13.3 percent. A household earning $1 million would pay $290,000 for an effective tax rate of 29 percent.
In Maryland, the effective tax rate imposed upon a millionaire is roughly 11 percent greater than the effective rate charged the median household. Nationally, the effective tax rate assessed on a millionaire is 118 percent greater than the rate assessed on the median household.
Compared to Maryland’s current marginal income tax rates, the current federal rates (signed into law by George W. Bush) are far more progressive.
[Continue reading Todd Eberly’s post at The FreeStater Blog.]
Todd Eberly blogs at The FreeStaterBlog. The Local Blog Network is a group of bloggers from around the D.C. region who have agreed to make regular contributions to All Opinions Are Local.