10 REPORT OF THE COMPTROLLER OF THE TREASURY

which, deducted from the bonds issued, accounts for the increase in
the Bonded Debt of $5,839,000.00.

We have authorized, but unissued, the following bonds, which
will not be issued until the need for the money coming therefrom is
required in the carrying out of the provisions of the law for which
the bonds were authorized to be sold:

State Office Building in Baltimore City......................$2,000,000.00

General Construction Loan of 1947............................. 6,695,000.00

State Armory Loan of 1948 ............................................ 560,000.00

State House Improvement Loan of 1948........................ 525,000.00

The Cash Balance in the Annuity Bond Fund at June 30, 1948
was $1,356,408.34. The balance in that account at the end of the
previous year was $1,379,095.06.

The revenues from the several sources providing general funds
for State operations, received in the Fiscal Year, exceeded the
estimates by $9,239,744.52. This increase was due in large measure
to the receipts from Income Taxes and Sales Taxes exceeding
somewhat the estimates made of revenues to be received from those
sources.

The total receipts from Income Taxes in the year amounted to
$19,595,850.59, of which $14,685,013.79 was applicable to the tax-
able year 1947; $4,424,618.01 was applicable to the taxable year
1946, and the balance of $486,218.79 was applicable to the taxable
year 1945 and prior years.

Under the law as'it is at this time the rate of tax on individual
ordinary .income will be 2 1/2% for the taxable year 1948, being an
increase from 2%, although the Board of Revenue Estimates has
recommended that the Law be amended to continue the 2% rate
for the taxable year 1948 because of the fact that the loss in revenue
occasioned thereby can readily be absorbed by the excess General
Fund Surplus we estimate we will have in the State Treasury at
the end of the Fiscal Year 1949.

The rate of tax on Investment Income will continue at 5% on
1948 taxable income.

The rate of tax on Corporation Income in the taxable year 1948
will be increased from 1 1/2% to 4%, in accordance with an amend-
ment to the Law at the 1947 Session.

RETAIL SALES TAX DIVISION:

The Maryland Legislature at the 1947 General Session enacted
the Maryland Sales Tax and Use Tax laws. It was originally esti-
mated that the taxes would produce $18,400,000.00 in their first
year of operation. Actually, $23,635,242.97 was produced in the,
first fiscal year, which represents the collection of eleven months
taxes. The new laws in their first year produced more funds than