Baltimore County Executive Johnny Olszewski’s first budget takes effect Monday and it includes the first tax increases in the county in a generation.
However, residents won’t feel some of the tax hikes right away.
The income tax rate will go up from 2.83% to 3.2%, the first increase since 1992. But that won’t be collected until January. Baltimore County Council Chairman Tom Quirk said changing the rate in the middle of a tax year would be too confusing for both taxpayers and tax preparers. Once it’s being collected, the income tax hike is expected to generate more than $30 million annually for the county.
The county’s property tax rate remains unchanged.
Olszewski spokesman T.J. Smith said the new tax on cell phone accounts and the hike in the county’s hotel room tax will start showing up on bills around July 12.
“We’ve notified cell carriers, hotels motels and others,” Smith said.
Olszewski initially proposed charging cell phone users a tax of $3.50 per line monthly. But after hearing a lot of blowback on that idea, the county council dialed that back to an 8% charge per account per month. The tax only applies to the actual “phone" part of the bill, not the data plan.
The hotel room tax is going up from 8% to 9.5%.
The county council in May approved charging developers impact fees to help cover the costs of schools and roads. But the implementation of that was delayed a year which means the county will not see additional money from that for awhile.
“We likely won’t see any revenue until fiscal year 2023,” Smith said.
Olszewski had made the case the tax increases were needed to close an $81 million shortfall while at the same time spend money on things the county needs. Smith said that will start happening now.
“More roads paved and repaired,” Smith said. “Teachers and public safety officials will see their pay raises take effect as well.”
Also, the school system has about 100 new positions and the county is looking to fill several newly-created jobs, including an opioid strategy coordinator.