If you’ve spent much time in the Washington D.C. area, then you’ve heard of Maryland’s reputation as the higher tax state. People debate the strengths of different neighborhoods and locales: the tradeoffs between a long commute and better schools, more traffic but a better variety of restaurants, but you would rarely if ever hear anyone make the argument that one should move to Maryland to lower their tax burden.
It appears that parts of Maryland want to double-down on that high-tax reputation and tack on a big tax hike on resident’s cell phone bills. Industry experts warn that Prince George’s County wants to increase the county tax on wireless services by 50 percent, from 8% to 12%, which translates into up to a new $360 annual bill for Maryland families.
Cell phone services are already subject to bizarrely high tax rates, as I’ve written before. Why do Maryland officials want to increase these taxes even more?
Most likely, it’s just because they think they can. Cell phones have become an integral part of life, so people are going to keep using them, even if government forces the price up. The economic term for this is “inelastic demand,” and its existence can be an invitation for bureaucrats to tax gleefully.
Yet the people of Maryland should say enough is enough. Even good liberals who think that Maryland government just isn’t quit big enough and needs more money ought to pause since this higher tax on wireless services (which will also hit traditional phones and cable TV) will be regressive, in that those with lower incomes will be hurt most as they lose a bigger portion of their money to these higher bills.
Rather than fulfilling their high tax reputation, Maryland officials should be finding ways to cut waste and make the bureaucracy more efficient, and leave Maryland families alone.