Mainers Fed Up With Taxes? Vote YES or NO on Question 1? Which Is It Really?

Tuesday, June 8, 2010 Mainers will head to the polls for the gubernatorial primary election as well as 4 bond issues and a potential people's veto on the ballot.

By now, we have all seen the signs and television ads from both sides of Question 1.  This issue is going to be confusing for a lot of us, since both sides are saying the same thing in support of their view. 

Fed up with taxes?  Vote "yes" on Question 1!

Fed up with taxes?  Vote "no" on Question 1!

So, which is it?  Yes or No?  Well, that depends on your point of view, but I would HIGHLY encourage everyone to bypass the commercials and actually read the citizens guide with both supporting and opposing views on this issue before you decide.

Here is just a sampling of the info available in the guide.  These are comments submitted by Kay Rand in support of the tax reform that was passed and urging Maine citizens to vote "no" to the impending people's veto.  As citizens, it can be easy to get swept up in our power to veto without fully comprehending the impact of undoing the enacted and much needed tax reform.

"The tax reform and relief law enacted by the Legislature last year reduces Maine's maximum income tax rate from 8.5% to 6.5% for nearly all taxpayers.  According to data published by the Maine Revenue Service, 95% of Maine residents receive an income tax cut under the new law. More than 88% of Maine taxpayers receive a net tax reduction after taking in account all taxes they pay to the State.

The new law pays for the income tax cut by requiring non-residents and visitors to pay a fairer share of taxes through a modest increase in the meals and lodging tax. Maine had the lowest meals and lodging tax in New England. Additionally, the sales tax was broadened to include entertainment and certain personal property and repair services.  The new law is revenue neutral, meaning that changes to the income and sales tax will result in the same amount of total revenue to the state. The Maine Revenue Service estimates that the new law reduces the tax burden on Maine residents by approximately $53 million, most of which is "exported" to non-resident taxpayers and visitors.

Until passage of this landmark law, Maine had approximately the 7^th highest income tax rate in the nation. This discouraged investment by businesses and entrepreneurs and drove many newly retired people out of Maine to states with lower income tax rates.  

If the new law is repealed, the maximum income tax rate will increase by nearly 30% (6.5% to 8.5%) and the meals and lodging tax will be reduced from 8.5% to 7% -- far below the regional and national average  - rewarding visitors with a significant tax break. 

If you want a fairer tax code, more investment in Maine's economy, lower income taxes and lower taxes overall, please vote NO on Question 1."