Delaware lawmaker proposes new upper income tax brackets

WDEL | by Mark Fowser

Creation of two new upper income tax brackets is being proposed as a way to create long term revenue stability for the State of Delaware, instead of depending upon one-time revenues.

A state House committee Wednesday voted to release legislation that would tax individual filers who make $125,000 at 7.1 percent. Delawareans who earn $250,000 would face an income tax rate of 7.85 percent. The current rate is 6.6 percent for someone who earns $60,000 or more of taxable income.

State Representative John Kowalko, D-25th, sponsored House Bill 106 as a way to reduce the state’s dependence on fluctuating sources of revenue such as increases in the alcohol tax and realty transfer tax.

“I don’t think the people making under $60,000 a year – or even over $60,000 but less than $125,000 – deserve to have their taxes increased,” Kowalko said. “But, I do think there’s an affordable level once you start getting individuals over $125,000 and individuals over $250,000, I don’t think it’s much to ask those individuals to contribute. I don’t take it lightly when I ask those individuals to contribute more of their money to the government.”

“The government provides services, and those services cost money,” Kowalko added.

Some members of the revenue and finance committee had reservations about the proposal, although it was approved for possible action in the House. According to Kowalko, the proposal would ensure a stable source of revenue that could withstand ups-and-downs in the economy.

“It would grow when the economy grows. As the economy grows and there are more people that make that kind of money, that would sustain the necessary growth in services that we provide as a government,” Kowalko said.

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