Governor Wes Moore has unveiled a broad tax reform plan aimed at closing Maryland’s projected budget shortfall and modernizing the state's tax code. Facing rising costs in healthcare, education, and transportation, the Moore administration is proposing a mix of targeted tax increases and new revenue streams intended to generate over $1.2 billion annually by FY 2027.

The proposed legislation, known as the “Fair Share for Maryland Plan,” is already generating statewide debate — especially among business owners, tax professionals, and high-income earners.

Where Do We Stand on Maryland’s Budget?

Maryland is projected to face a $3 billion structural budget deficit by FY 2028 if no changes are made. This gap is largely driven by increased spending obligations tied to the state’s education funding law (the Blueprint for Maryland’s Future) and public employee benefits.

Governor Moore’s budget team is pursuing a strategy that combines modest tax increases, expanded tax bases, and cost-cutting reforms to stabilize the state’s finances without widespread cuts to services.

What Tax Policies Are Set to Expire or Get Adjusted?

What Are the Proposed Tax Changes?

Key components of Moore’s reform package include:

The proposal also includes a minimum corporate tax floor aimed at preventing large multinationals from paying $0 in state income tax.

Which Proposals Are Most Likely to Pass?

The Maryland General Assembly, controlled by Democrats, is generally aligned with Moore’s priorities, but opposition is forming around:

The progressive income tax tiers and tobacco excise increases have broader support and are more likely to pass in some form.

What This Means for Individuals and Businesses

For high-income individuals:

For service-based businesses:

For real estate investors:

For tech firms:

How to Tax Plan Around These Changes

Tax professionals and CPAs advising Maryland-based clients should begin:

Final Thought

Maryland’s proposed tax reform reflects a growing trend among states: adapting outdated tax codes to meet the demands of a modern, service-driven, and digital economy — all while balancing budgetary pressures.

Whether you’re advising high-net-worth clients, running a software firm, or guiding estate planning strategies, staying ahead of these developments is critical.

At Bizora AI, we’ll keep tracking this legislation in real time and helping firms adjust with smart, proactive strategies.