As revenue concerns grow, legislators say ‘challenges demand CPAs’ input’

As Maryland’s General Assembly arrives in Annapolis for its 2025 lawmaking session, so too have a variety of critically important issues from all corners of the legislative world — federal, state, and professional issues alike that are joining forces to create a legislative environment that could be more impactful than any in recent memory.

• Maryland’s budget gap is growing, with one analyst predicting that the state will be able to cover only 84% of its expenses by 2030. “That is the largest gap that we have seen in the last 20 years,” Department of Legislative Services budget analyst David Romans told Maryland Matters. “It is more significant than the Great Recession.”
  
  
• Maryland Senate President Bill Ferguson has said “everything is on the table” as lawmakers look for ways to address the budget shortfall. That could include yet another effort to enact a sales tax on professional services, including those provided by CPAs.
  
  
• Several campaign promises made by returning President Donald Trump could make a bad state budget situation even worse. With 8% of Maryland taxpayers earning federal paychecks and $42 billion in federal contracts directly impacting our state, efforts to scale back government projects and employment would be particularly painful to Maryland. State lawmakers could be tasked with raising the revenue needed to offset the potential losses.
  
  
• The CPA profession’s ongoing talent shortage could compel lawmakers to examine Maryland regulations and accommodate evolving licensure pathways in other states.

The convergence of these critical legislative issues highlights the growing importance of legislative advocacy for Maryland's CPAs. The message for MACPA members is clear: Vigilance is key as Maryland’s legislative season arrives, and that makes the 2025 edition of CPA Day in Annapolis especially important.

Scheduled for Jan. 16 at the Governor Calvert House in Annapolis, CPA Day gives members an opportunity to meet in person with their state legislators and discuss issues that impact Maryland CPAs and those with whom they do business. The event is immeasurably impactful: Legislators enthusiastically look forward to speaking directly with their constituents about the issues, and CPAs offer lawmakers deep experience, insights and expertise in matters related to finance and fiscal strategy.

Given the high-profile, revenue-related topics that could be on the General Assembly's docket, those insights will be more valuable this year than ever -- but those aren't the only issues MACPA members will be watching this year. The key issues on the association’s 2025 agenda are:

1. Support enhanced mobility for CPAs.
As conversations continue about how to best address the CPA profession's ongoing talent shortage, proposed new legislation aims to maintain CPA mobility in Maryland by adjusting existing statutes to accommodate evolving licensure pathways in other states. Sen. Arthur Ellis, himself a CPA, has agreed to sponsor a bill to that effect.

2. Opposing sales taxes on professional services, including those provided by CPAs.
Proposing a sales tax on services to raise revenue would burden the citizens and businesses of Maryland unnecessarily with additional taxes and compliance complexity. It also would negatively impact economic growth and development. CPAs believe any proposal to implement sales taxes on professional services would be bad for small business in Maryland, and the MACPA will work to defeat such legislation if introduced.

3. Opposing efforts to replace Maryland’s contributory negligence standard with a comparative fault rule.
At present, Maryland courts allow a person sued for negligence or wrongdoing to raise the “contributory negligence” defense — that is, the party sued may claim that the plaintiff contributed to his injury and thus should not be allowed to recover from the defendant. This long-standing rule in Maryland courts prevents a person from shifting his or her responsibility to others.

The contributory negligence standard should be maintained in Maryland because:

• it prevents a flood of suits by plaintiffs who have a disproportionate amount of fault;
• it keeps the lid on insurance premium growth rates;
• it fosters the exercise of due care by all persons; and
• it enhances the predictability of litigation, including its costs.

4. Support proper budget funding for the Maryland Comptroller’s Office.
During the past two General Assembly sessions, the MACPA has supported the Maryland Comptroller’s Office’ request for additional funding needed to carry out its extensive agenda. The Legislature agreed, and good things have happened during the past year thanks to the additional funds, but the need for expanded funding still exists, particularly when it comes to addressing current inefficiencies and ensuring successful implementation of any new tax policies.

Among its many functions, the Comptroller’s Office is responsible for collecting tax revenue and enforcing compliance with the state’s tax laws. As the collector of much of the state’s cash, it is logical that the Office be supported with a proper budget for appropriate personnel levels as well as much needed technology upgrades..

The MACPA supports a properly funded budget that will allow the Comptroller’s Office to retain its current team as well as hire additional qualified personnel by offering competitive salary levels, and also allow for a more modern IT system for efficiency of the agency’s tax administration operations.

A comprehensive list of position papers and the bills the MACPA is following this year will be found throughout the legislative session at MACPA.org/advocacy.

Making connections and having conversations with Maryland’s legislators is a key part of the MACPA’s member promise — to promote the value of the profession and support positive legislative outcomes for our members and the public.

“If we don’t have a seat at the table,” one MACPA member said, “we could end up on the menu. Thanks, MACPA, for giving us that seat.”

Those conversations are also tremendously valuable to lawmakers.

“CPAs have unparalleled credibility in tax and business policy discussions,” said Sen. Brian Feldman, himself a CPA. “Unlike other professions with obvious agendas, CPAs are seen as objective and trustworthy, making their voices especially impactful. Maryland’s economic challenges — high taxes, stagnant growth, and dependency on federal funding — demand CPAs’ input to shape practical solutions.”