Bill Positions

Bill Number: SB 472

Bill Title: Income Tax - Denial of Deduction for Excessive Compensation of Officers

Bill Sponsor(s): Senator Pinsky, et al.

Subject: Budget & Tax

Committee: B&T

Bill Summary: This bill would have required a corporation to add back to its Maryland modified income the compensation paid to an officer or director that exceeds 25 times the compensation paid to the company's lowest paid full time employee.

History: In 2007 the Chamber opposed SB 395, which died in the Budget & Taxation Committee without a vote. Similar bills also failed in 2002 and 1997. In 2009 SB 472 received an unfavorable report from the Budget & Taxation Committee.

Chamber Position: Oppose

Position Summary: This bill would have created another disconnect between federal and state tax rules that would cause unnecessary complexity and cost for Maryland employers. Decisions regarding private sector compensation should be set in the marketplace, not by arbitrary state law. As none of Maryland's competitor states has such compensation limitations, the bill would have hurt our state's ability to attract and retain businesses. While the bill would have further damaged the state's reputation as a place to do business, it would have raised little in additional state revenues.

Position Statement: Click here (pdf)

Chamber Staff: Ronald Wineholt

General Assembly: Click here to view the bill on the Maryland General Assembly's website.