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June 5, 2009

House gives early nod to tax reform bill

By The Mainebiz News Staff

The Maine House of Representatives yesterday gave preliminary approval to a controversial tax reform bill.

The House voted 84-59 to approve LD 1088, which would decrease the income tax from 8.5% to 6.5%, increase the state's meals and lodging tax from 7% to 8.5% and expand the state's 5% sales tax to cover more goods and services. The vote was almost entirely along party lines, with Democrats supporting the bill. Opponents said the bill is too complicated and too costly to Mainers. "[The bill is] way too confusing, way too complicated and way too costly for the people ... and in the end, the benefit is way too small to work," said Rep. Kathleen Chase (R-Wells), according to the Bangor Daily News.

The expanded sales tax would cover "amusement, entertainment and recreational" services, including theater, movie and museum tickets, golf course fees, ski lift tickets and white-water rafting trips, and "installation, repair and maintenance services," including furniture restoration, vehicle repair and the maintenance of office equipment, according to the bill's text.

The bill faces additional votes in both the House and Senate, which is expected to consider it today. Gov. John Baldacci has not said whether he supports the bill.

Reader comments

From Kelly Marie

The tax reform is just shuffling the cards and dealing from the bottom of the deck. Cutting taxes for higher earners does little to help those who need it most. Taxing movies and other amusements, formerly tax free, will only serve to hurt those businesses more. People have less disposable income nowadays and they are hurting enough. Lastly, that 5 cent per gallon gas tax is the worst! We already have some of the highest fuel taxes in the nation! ENOUGH ALREADY! Other states manage to do with less!  

From June Cook

Keep on taxing us and you'll be sure to have us close and leave the state. This is too much for small businesses to bear.

I am sick of all the new fees and taxes. The profit margin is so low already.
 

From Rick Snow

This bill will not only kill my business but at least 5 others here in Scarborough. I also did the income tax change to my last years income tax and discovered I would pay $1400 more in taxes since they don't mention that the bill lowers income taxes but eliminates deductions and exemptions. So you pay 6.5% on your Maine Adjusted Gross income. The bill offsets that with a max credit of $2300. Since I have 3 children I will pay a lot more income tax to Maine. I will also pay a lot more sales tax. Please call, mail, and email the Gov and have him VETO this terrible bill!!!  

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