Business leaders warn proposed tax and fee increases will harm Montgomery County competitiveness

Business groups and small business owners told the County Council the proposed FY27 tax and fee increases would damage Montgomery County’s economic competitiveness and harm small employers.

Paul Ross (Gaithersburg‑Germantown Chamber) and other chamber representatives urged rejection of a proposed 6.3% property‑tax adjustment, increased income‑tax authority and higher transportation, water and permitting fees. They argued that cumulative increases and regulatory complexity discourage housing and commercial investment and accelerate out‑migration.

Small business owners described the real‑world impacts: one moving‑company owner said development impact fees, permitting costs and new charges make local expansions unaffordable and could drive businesses to neighboring jurisdictions. Chamber witnesses also asked the council to link investments in workforce development, Montgomery College and infrastructure with any revenue proposals and to prioritize policies that attract and retain private investment rather than increasing tax burdens.

Affordable‑housing advocates at the hearing separately urged the council to restore or increase preservation and development investments, noting the FY27 proposal included roughly $100 million for preservation but that the county’s pipeline would need about $169 million to advance projects ready to begin. Councilmembers will weigh tax policy, competitiveness and housing pipeline trade‑offs during budget deliberations.