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Maryland Keeps Revenue Outlook Steady as Federal Job Cuts Mount

Recent tax increases, paired with strong reserves, are buffering early fallout from federal cuts.

Overview

  • The Board of Revenue Estimates set current-year general fund revenues at $26.6 billion—$19 million below March’s figure—and projected $27.1 billion for the next fiscal year.
  • Maryland closed fiscal 2025 with $520.7 million above forecast, led by stronger personal income tax collections, enabling a $382.3 million deposit to reserve funds.
  • The federal OB3 tax law is expected to reduce state revenue by about $189.3 million over the next two years, according to the comptroller’s office.
  • Federal workforce reductions have already cost Maryland more than 15,000 jobs, with officials saying losses could reach roughly 25,000 by year’s end, equal to about 9.3% of the state’s federal workforce.
  • State officials warned of risks from a potential federal shutdown, changes to Medicaid and other benefits, increased immigration enforcement, and tariffs, with another revenue update due in December and more detailed data expected by March.