Gov. Paul LePage says his proposal to eliminate the state income tax by 2019 is about “keeping Mainers in Maine.” LePage has proposed the gradual elimination of the income tax as part of his biennium budget.

LePage sought grassroots support for his plan on Feb. 18 at the Lincoln County Republican Committee’s meeting in Waldoboro. LePage spoke to a audience of about 60 people who gathered at the Charles C. Lilly American Legion Hall in Waldoboro.

LePage asked local Republicans to urge their legislators to support his tax plan, along with his proposals to reduce energy costs.

The governor estimates his budget will reduce Maine’s tax burden by $300 million. He believes the proposal will make Maine competitive in both national and global markets; propel Maine’s national ranking from 33rd to 23rd in terms of tax climate; and attract good paying jobs.

The  tax plan’s central points include gradually eliminating the state income tax and state revenue sharing, along with an option for municipalities to tax 50 percent of nonprofit property valuations over $500,000.

LePage believes his plan benefits both large and small communities. He used the towns of Falmouth and and Lowell as examples.

In 2013, the town of Falmouth residents paid $10,927,465 in state income tax. In 2014 the town received $457,149 in municipal revenue sharing.

Falmouth income-taxpayers would save $5,811,269 under the first phase of the plan. The town of Lowell (located in Penobscot County) received $17,036 in municipal revenue sharing in 2014. Residents paid $212,880 in 2013 income taxes. LePage calculated residents would save $65,316  under the plan’s first phase.

LePage believe the loss of revenue sharing and elimination of income taxes is a good for Mainers. He cited his former hometown as a prime example. In 2014, Waterville received $1,092,723 in revenue sharing and in 2013, residents paid $9,734,474 in income taxes.

“That’s almost a 10-1 ratio. I’d take that all day long,” he said.

LePage thinks nonprofits who use municipal services should as pay a portion for the cost. Again, he chose Waterville as an example. The former mayor said the city has three hospitals, two colleges and 108 nonprofit agencies.

“Colby College has a beautiful campus that is known worldwide. It’s property valuation is greater than the entire city’s,” LePage said. “Colleges and universities are heavy users of local police departments. Why shouldn’t these entities help pay for the services they use?”

In general, LePage believes his proposal will reverse the trend of people leaving Maine.

The plan is specifically designed to attract both senior citizens and young military families.

For seniors, his tax reform doubles the Homestead Exemption to $20,000, a property tax rebate for those paying more than six percent of income for property taxes, and a $35,000 exemption on pension income.

For military veterans coming home from tours in Iraq and Afghanistan, the governor would eliminate taxing their pensions. This would make Maine more attractive to veterans in their 30s and 40s, possibly starting second careers, according to LePage.

The Republican governor is also proposing more taxes in his budget.

Younger property owners, those who are not senior citizens, would lose their $10,000 property tax Homestead Exemption. The sales tax also would be expanded.

As the plan is phased in, LePage wants to ease the burden on property owners who would lose their Homestead Exemption. Property owners would receive tax credits. The governor wants to return $34 million to property owners through a tax credit in the plan’s first year, $60 million the next year, and $90 million in the third.

LePage’s goal is for tax relief and reform for Mainers. He passed out “Moving Maine from Poverty to Prosperity,” to the audience. The booklet summarizes the proposal and shows how each town fares under the plan. 

The plan provides tax relief by shifting the tax burden from income to consumption taxes. LePage said, in 2013, over 653,000 residents filed state income tax returns. He wants to expand the tax base by calling on the estimated annual 29 million tourists to bear more of the burden.

“Maine is a poor state,” he said. “ ... What I’m trying to do is broaden the sales tax so the visitors who enjoy our state’s beauty also leave a little more cash here.”

So far, LePage has identified the Maine Municipal Association as the most vocal critic of his proposal. He advised the audience to be wary of the upcoming criticism. The governor described the MMA’s focus as working solely for its 200-plus municipal government membership.

“The difference is I work for the people who live in those communities. I’ve never heard anyone in the MMA ever say they work for the people of Maine,” LePage said.

The governor wants communities concerned about lost state revenues to reassess their local budgets. He wants these communities to either look for efficiencies (such as consolidating services with neighboring communities) or increase taxes.

County GOP chairman Stuart Smith is one of those local municipal leaders who may have to deal with the loss of state revenue sharing. Smith is an Edgecomb selectman. He is generally supportive of the plan, but he believes the plan most likely will be changed in the legislature.

“The Democrats still control the House. So while I like several aspects of the plan, I want to wait and see what appears on the governor’s desk before deciding if I support the ultimate legislation.”

The Lincoln County GOP committee meets next at 6:30 pm. on March 18 at the Newcastle Fire Station.

Related: With nonprofit tax, even winners may be losers