The Maryland General Assembly passed a budget this session that raises approximately $340 million in additional revenue for transportation and education programs, and increases funding for the state’s shock trauma system. But not every Marylander will foot the bill.Most of the increases come in the form of vehicle-related fees and fines, which will be used to pay for trauma care and transportation projects. A chunk of new tax money for education will largely come from tobacco users.The compromise among Democrats, who control the legislature, comes after two weeks of contentious debate over how to pay for expenses lawmakers had already taken on. House leaders wanted more increases, Senate leaders wanted fewer. Lawmakers ultimately opted to modestly increase revenue largely through fees without raising income tax, general sales taxes or corporate taxes, or by creating a tax on online poker.Gov. Wes Moore (D), who in January proposed a budget balanced with cuts and no major tax increases, said he was pleased with where lawmakers landed.“I’m going to have a very high bar when it comes to revenue increases, and specifically when it comes to things that are impacting working families,” he said Monday as the General Assembly held its final day of the session.The legislature did not address how the state will pay for future transportation costs and looming expenses associated with its signature education program — known as the Blueprint for Maryland’s Future — beyond fiscal 2027.Here’s how the new taxes and fees will affect some Marylanders’ pocketbooks in June:
Drivers will pay more
Return to menuMaryland drivers will pay more to buy a vehicle and use the roads.All drivers who register a vehicle in Maryland will have to pay an additional $23 surcharge each year — or $46 every two years — when their registration comes due. That money will more robustly fund the Trauma Physician Services Fund, the shock trauma system and the Maryland Emergency Medical System Operations Fund.Registration fees will also be rising to generate nearly $169 million in new revenue, with heavier vehicles costing more than light ones.“Higher-weighted vehicles put more wear and tear on our roads and should be paying a higher fee, in effect a user fee, for the maintenance of those roads,” said House Appropriations Committee Chairman Ben Barnes (D-Prince George’s) at a news conference last week.Shoppers looking for a new car should keep their eyes open for an $800 dealer processing charge on their bill of sale — a fee that was previously capped at $500. That fee is negotiable at the dealership, but virtually all car salespeople will initially include it in a vehicle sale. That $800 will be added to the total sale price, which the state then taxes at 6 percent. If you agree to pay the $800 fee, you will end up paying more in tax, too.For those who purchase an electric vehicle, the price goes up even more. The owners of plug-in electric vehicles will have to pay an additional $125 surcharge every two years when they renew registration. Plug-in hybrid drivers will pay a $100 surcharge. Barnes said those new electric-vehicle fees are “tantamount to what you would pay in gas tax,” if you drove a gas-powered car.