Jealous Pitches Sales Tax Cut, Paid For By Hedge Fund Managers
Let’s say you buy a new TV for $500 dollars. Maryland’s current 6-percent sales tax would add $30 on top of that.
Democratic gubernatorial nominee Ben Jealous announced Thursday that if elected, he would cut the state sales tax to 5.75 percent, saving you $1.25 on that TV purchase.
Jealous estimates that the tax cut would cost the state between $175 and $193 million a year. He says he would recover about $58 to $78 million by closing a loophole that allows hedge fund managers to pay a lower capital gains tax rate on part of their income.
“It’s unfair that hedge fund managers pay a lower effective tax rate than their secretary,” he said during a press conference Thursday. “And it’s unfair that people shopping on Main Street have been paying a higher sales tax than they need to in part to help subsidize hedge fund managers’ profits.”
Jealous would lean on sales taxes on internet purchases — which the state already plans to begin collecting next month — to make up another $50 to $150 million. Together with the tax hike on hedge fund managers, he expects this would add up to about $108 to $228 million, which may or may not close the gap left by his tax cut.