Article - State Income Tax Rates
§10-105. State income tax rates [Amendment applicable to tax years beginning after December 31, 1997].
(a) Individual.- The State income tax rate for an individual is:
(1) 2% of Maryland taxable income of $1 through $1,000;
(2) 3% of Maryland taxable income of $1,001 through $2,000;
(3) 4% of Maryland taxable income of $2,001 through $3,000; and
(4) for Maryland taxable income in excess of $3,000:
(i) 4.875% for a taxable year beginning after December 31, 1997 but before January 1, 1999;
(ii) 4.85% for a taxable year beginning after December 31, 1998 but before January 1, 2000;
(iii) 4.85% for a taxable year beginning after December 31, 1999 but before January 1, 2001;
(iv) 4.8% for a taxable year beginning after December 31, 2000 but before January 1, 2002; and
(v) 4.75% for a taxable year beginning after December 31, 2001.
(b) Corporation.- The State income tax rate for a corporation is 7% of Maryland taxable income.
(c) Married persons filing joint returns.- For a husband and wife filing a joint income tax return, the rates specified in subsection (a) of this section apply to the joint Maryland taxable income of the husband and wife.
(d) "Applicable dollar amount" defined.- Abrogated.
[An. Code 1957, art. 81, § 288; 1988, ch. 2, § 1; 1992, 1st Sp. Sess., ch. 2, §§ 2, 3; 1993, ch. 256, § 1; 1997, ch. 4, § 1; 1998, ch. 4.]
§10-106. County income tax rate [Amendment applicable to tax years beginning after December 31, 1997].
(a) In general; exception in Howard County.-
(1) Each county shall set, by ordinance or resolution, a county income tax equal to at least 20% but not more than 60%, to be applied to the State income tax for an individual, modified as provided under subsection (d) of this section.
(2) A county income tax rate continues until the county changes the rate by ordinance or resolution.
(3) (i) A county may not increase its county income tax rate above 50% until after the county has held a public hearing on the proposed act, ordinance, or resolution to increase the rate.
(ii) The county shall publish at least once each week for 2 successive weeks in a newspaper of general circulation in the county:
1. notice of the public hearing; and
2. a fair summary of the proposed act, ordinance, or resolution to increase the county income tax rate above 50%.
(4) Notwithstanding paragraph (1) or (2) of this subsection, in Howard County, the county income tax rate may be changed only by ordinance and not by resolution.
(b) Rate change - In general.- If a county changes its county income tax rate, the county shall:
(1) increase or decrease the rate in increments of 2 percentage points or 5 percentage points, effective on January 1 of the year that the county designates; and
(2) give the Comptroller notice of the rate change and the effective date of the rate change on or before July 1 prior to its effective date.
(c) Calculation of rate.- For purposes of determining the county income tax, the State income tax shall be calculated by:
(1) using a State tax rate of 5% for Maryland taxable income in excess of $3,000 instead of the marginal State tax rate for individuals specified under § 10-105 (a)(4) of this subtitle;
(2) allowing a maximum of $1,200 instead of the maximum amount specified under § 10-207 (r) of this title for the subtraction modification for two-income married couples; and
(3) allowing $1,200 instead of the amount specified in § 10-211 (1) or (2) of this title for each exemption allowed under § 10-211 (1) and (2) of this title.
[An. Code 1957, art. 81, § 283; 1988, ch. 2, § 1; 1992, 1st Sp. Sess., ch. 2, §§ 2, 3; 1993, ch. 180; 1997, ch. 4, § 1; 1998, ch. 399.]
§10-107. Application of federal income tax law.
To the extent practicable, the Comptroller shall apply the administrative and judicial interpretations of the federal income tax law to the administration of the income tax laws of this State.
[An. Code 1957, art. 81, § 304; 1988, ch. 2, § 1.]