Newark Post | by Staff and Wire Reports
Democratic lawmakers in Delaware are proposing several new tax brackets that would result in higher-income individuals paying more to the state’s coffers.
“This bill is intended to ensure a more fair and equitable progressive tax structure that is sustainable and not overly burdensome to any category of earners,” said Rep. John Kowalko, of Newark, who is sponsoring the bill. “It has been carefully calculated to apply a minimal amount of tax increases while ensuring a sustainable revenue source in future economic downturns.”
The increased taxes would only impact people whose taxable personal income exceeds $125,000. All wages under that amount would see no increases in taxes.
The current top tax rate in Delaware is 6.6 percent for taxable income exceeding $60,000.
The bill introduced Wednesday would apply the 6.6 percent rate to income between $60,000 and $125,000 and create a new rate of 7.1 percent for taxable income in excess of $125,000, up to $250,000.
Those with income between $250,000 and $500,000 would pay 7.85 percent, and a top rate of 8.6 percent would be established for Delawareans with taxable income of more than $500,000.
“Fundamentally, this legislation is built around fairness and stability. It has been decades since we last meaningfully updated the structure of this tax – one of Delaware’s most stable, important sources of revenue – and we cannot keep waiting while inflation and rising income inequality gradually shift the burden further down the income ladder,” said Senate President Pro Tempore David Sokola, also from Newark. “This bill levels the playing field and better prepares us for our state’s long-term future. It’s fair and straightforward and I look forward to working with our partners in the House to get it passed this year.”
Kowalko has proposed similar bills at least three times over the past few years, but they were never voted on.
This year’s bill is co-sponsored by almost the entire Democratic delegation from the Newark area, including Sokola, and state representatives Paul Baumbach, Ed Osienski, Eric Morrison, Madinah Wilson-Anton and David Bentz.