Politics & Co.
The Legislature faces a crush of work, having dealt with just 50% of committee bills by April 29. The Legislature expects to adjourn by June 19. Here’s what’s on deck now:
Gang mentality
As the state stares down a nearly $900 million, two-year budget gap, a bipartisan group of legislators has advanced a tax overhaul it hopes will raise $700 million and avoid suspending state revenue sharing with municipalities, as proposed by Gov. Paul LePage. The plan, from a group of 11 legislators dubbed the “Gang of 11,” calls for more sales tax revenue and lower income taxes. All purchased products, except health care and education expenditures, would be subject to sales tax, and the rates for general sales tax and lodging tax would rise by 1%. The plan also calls for reductions in the state’s corporate tax rate, lowering it from 9% to 3.5% on the first $50,000 of income and 7.5% for income over that amount. Skepticism over the proposal lingers. The Bangor Daily News reported some lawmakers see it as a repeat of a failed 2009 tax reform package passed by the Legislature and later rejected by voters. The bill will likely be in discussion over the coming weeks.
Airing proprietary details
The Legislature’s Taxation Committee held a recent public hearing on LD 1126, a bill that would require businesses to submit proprietary tax payment disclosures to the Secretary of State’s Office that would be made public two years after their filing dates. The proposal drew strong opposition from the Maine State Chamber and the Retail Association of Maine. Supporters of the bill testified that making certain tax information public would help legislators evaluate economic development strategies and that the two-year delay preserves some confidentiality for the businesses. Linda Caprara, testifying for the Maine State Chamber of Commerce, called the bill “very troubling,” and said it would reveal information that would put Maine businesses at a competitive disadvantage.
Unveiling: iTax
Maine’s U.S. senators helped pass a bill to allow states to collect sales tax from online retailers based elsewhere. Supporters of the bill say it would protect small brick-and-mortar retailers that compete with large online retailers, which do not have to collect sales taxes in states where they do not have offices or distribution centers. Representatives from states without a sales tax argue it is unfair to require companies based in these areas to collect sales taxes for sales made elsewhere. The bill passed the Senate, and now goes to the House.
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