The Legislature on Friday gave final approval to a controversial tax reform bill, but it is still unclear whether Gov. John Baldacci will sign it into law.
The bill, LD 1088, would increase the state’s meals and lodging tax from 7% to 8.5%, expand the state’s 5% sales tax to cover more goods and services and decrease the income tax for some Mainers from 8.5% to 6.5%. The bill was supported by the Democrats and passed almost along party lines, with a 19-15 vote in the Senate and 84-54 in the House. Opponents said the bill is too complicated and too costly to Mainers. While the average overall tax decrease would be $167, more than 100,000 Maine families would see taxes increase under the plan, according to a Maine Revenue Services analysis cited by the Kennebec Journal.
Gov. Baldacci has kept silent on whether he supports the bill. Joy Leach, a spokesperson for the governor’s office, told Mainebiz that the governor will make a decision soon on whether to sign the bill into law, but could not provide more specifics.