Maine House District 47

Reduce Maine state income tax

Mon, 05/22/2023 - 3:45pm

What Mainers earn belongs to them. They are "free" to use their earnings as they choose but they have chosen to let others decide where their earnings are to be used. Many are not satisfied with the decisions being made by others.

Earlier this year the Republicans attempted to get an income tax reduction for Mainers in the Biennial Budget. That attempt failed when the Democrat Majority Budget was passed.

On Feb. 28, a bill sponsored by Rep. Boyer of Poland and cosponsored by nine additional legislators, LD 835 An Act to Phase Out the Income Tax, was referred to the Joint Standing Committee on Taxation. This bill would phase out the income tax over five years beginning in 2024 and require that state department budgets be reduced proportionally.

A public hearing was held on Thursday, March 23. Thirteen individuals provided testimony. In favor of the bill were those concerned with Mainers and how they are coping with their individual economic situations. Looking at increased costs of everything, Mainers struggle to provide for their families, and businesses are seeing increasing energy prices and payroll costs. Some individuals may see an increase in their wages, while paying for their own increases with increased prices, a never ending cycle.

Opposed to the bill were those concerned with the results of a revenue loss of about $2.5 billion. They say it would result in an over-reliance on property, sales and use taxes, that it would hinder the delivery of refundable credits, significantly impact the state agencies’ ability to perform and alter Maine's progressive tax structure, one of the most progressive in the country.

The Committee Work Session, held on Wednesday, April 5, resulted in a Divided Report. The Majority voted Ought Not To Pass. The Minority voted Ought To Pass As Amended. On May 18, a motion was made in the House Chamber by Rep. Perry of Bangor to accept the Majority Ought Not to Pass Report. A Roll Call was requested and the motion prevailed. The Democrat Majority has again prevented a tax reduction for Mainers.

The Revenue Forecasting Committee is now projecting a further increase in revenue of about $900 million. Republicans will now have another opportunity to help Mainers by reducing and ultimately eliminating Maine State Income Tax. The Governor's proposed budget once again includes increased State spending. It is difficult for me to justify increased State spending when so many of the people of Maine are struggling with the increased costs of food, energy and fuel.

Income tax is a significant deterrent to business and industry, making it difficult for Maine to compete for new sources of income. The income tax-free states have a significant advantage over Maine. The Republican endeavor to allow Mainers to keep more of what they earn continues.