Maryland’s new budget framework includes tax increases and at least $2.3 billion in spending cuts for the 2026 fiscal year, Gov. Wes Moore and other Democratic state leaders announced at a press conference on Thursday.
According to Adrienne Jones (D-Baltimore County), speaker of the House of Delegates, the budget framework adds at least $500 million in spending cuts to Moore’s initial budget proposal announced in January.
But Jones said the framework will protect funding for state employees’ salaries, cancer research, crime victims and Maryland’s Developmental Disabilities Administration, which provides services for children and adults with disabilities.
Under the proposal, the state will generate more revenue by increasing income tax for top earners — though Moore said 94 percent of Marylanders will receive a tax cut or no change at all — and expanding the state’s sales tax to include a new three percent fee on IT and data services.
“Yes, we are asking those of us who have done exceptionally well to pay slightly more, so we can have the best schools in the country, so we can support law enforcement and our firefighters, so we can make sure that we are growing our economy,” Moore said.
Lawmakers did not specify which programs would face cuts.
The new agreement comes after the state entered budget negotiations earlier this year with a more than $3 billion budget deficit, which has since been exacerbated by federal uncertainty.
[Maryland expected to lose more than 28,000 federal jobs due to Trump administration]
More than 11,000 federal workers in Maryland have been impacted by U.S. President Donald Trump’s mass layoffs, with the state potentially losing up to 28,000 federal jobs, according to a presentation from state leaders earlier this month. The state could lose more than $260 million in revenue due to federal actions, according to the presentation.
Moore said Maryland must contend with no longer having a “stable partner” in Washington, D.C.
Moore added that Trump’s tariffs on the country’s largest trade partners could impact the state’s economy by more than $2 billion.
The Maryland Freedom Caucus, a group of conservative state lawmakers, held a rally in Annapolis on Wednesday protesting the “onslaught of tax increases” proposed as part of the budget deal.
[Maryland could face up to $1.5 billion in additional budget cuts]
After Thursday’s press conference, several members of the state legislature’s Republican leadership spoke to reporters about their concerns with the budget framework.
“They say they’re going to cut some stuff, and they may cut a few things, but I guarantee our budget will be larger than it was last year, and there will be a new tax on every working Marylander,” Sen. Justin Ready (R-Frederick and Carroll), the state Senate’s minority whip, said after the conference.
But Maryland Senate president Bill Ferguson (D-Baltimore City) said the proposal balances fiscal responsibility with protecting the state’s social safety net.
“At this critical moment in time, with a potential storm looming from the federal government, we must re-chart a new path for our great state that accounts for the chaos and uncertainty that we are seeing from D.C. every day,” Ferguson told reporters.
