5 Ways to Solve Maine’s Budget Crisis and Prevent Property Tax Increases

May 20, 2013 by

Legislators are working to close a $938 million budget gap that is the result of the worst recession since the Great Depression and unpaid-for tax cuts that mostly benefit the wealthy. Governor LePage’s solutions only shift state costs to our towns and cities, eliminate property tax relief and public services for residents who need it most, and fail to invest in our kids, our workforce, and our future.

As the legislature heads into the home stretch here are five ways to balance Maine’s budget, maintain investments in education and other vital public services, and avoid costly property tax increases for working families:

1. Repeal the 2011 income and estate tax cuts. Most Mainers will never see the benefits of the 2011 income and estate tax cuts since they are paid for by property tax increases that will hit low- and middle-income families hardest. At the end of the day, Maine’s wealthiest residents will still get a hefty tax cut while taxes on the typical Mainer will go up. This makes no sense and can be avoided by repealing the 2011 tax cuts.

2. Increase the taxes that we can truly export to out-of-state visitors and nonresidents. Tax rates on meals, lodging, and rental car sales are below the average of other New England states. Asking out-of-state visitors to pay more will generate much needed revenue that we can invest in Maine’s infrastructure and communities, making the state a more attractive place to visit and do business.

3. Get rid of corporate tax breaks that aren’t helping our economy. Large corporations like Walmart get significant subsidies through Maine’s tax code giving them both a financial windfall and an unfair advantage over Maine-owned businesses. These subsidies deliver no economic benefits – Walmart would do business in Maine anyway – but hurt our ability to invest in education and infrastructure that do make Maine a better place to live and do business. Maine’s patchwork of tax loopholes for businesses merits much greater scrutiny and accountability.

4. Make sure Maine’s wealthiest residents pay their fair share. The richest Mainers pay less than 10 cents on every dollar in state and local taxes, while the poorest 20 percent pay more than 17 cents on every dollar. It’s time for this to change. Maine’s wealthiest taxpayers should pay at least the same percentage of their income in taxes as the average Mainer. This is a better solution than the Governor’s budget proposal which requires low- and middle-income Mainers to shoulder the costs of tax cuts for Maine’s wealthiest residents making an already unfair tax system even more so.

5. Target tax relief where it is needed most and where it is most effective. Not all tax relief programs are created equally. The Maine Residents Property Tax and Rent Refund program is the best way to reduce property taxes for Maine residents who need it most. This program should be enhanced and the application process improved so that hardworking Mainers who pay more than 6 percent of their income in property taxes get the break they need.

Maine’s economy does not happen by accident. Legislative policy choices influence what our economy will look like and who can or cannot participate in that economy. Whether it is deciding who pays taxes and how much, who has access to education and the quality of that education, or what we invest in our people and our communities, the governor and the legislature choose the path we will follow.

Right now Maine’s legislature has the opportunity to strengthen the middle class by adopting budget solutions that ensure the rich pay their fair share, support working families, and stimulate economic growth.

4 Responses to “5 Ways to Solve Maine’s Budget Crisis and Prevent Property Tax Increases”
  1. Judy Lizzotte says:

    Cuts can be better made by both parties. For example in the 5th item above – It is not tax relief for renters to get a rebate—it is taxation and another subsidy for those who own rental units and pay the tax yet the renters get the rebate—How stupid is that??? Everyone paying a fair share is tax relief….so everyone pays a certain sales tax—if u do not spend, you will not pay taxes. Everyone spends so everyone pays equal taxes.
    Yes I believe out of staters should help pay more by paying higher in taxes in the “VACATION LAND” expenses such as restaurants, motels, flights, etc. I can’t afford to vacation much but when I do, I pay more taxes and figure this in my plans as an expense for vacation. If I can’t afford it, I stay home and do local trips or whatever.
    Yes I believe HUGE corporations should pay higher taxes to a certain extent but again we have to think this thru. Without big corps to higher Mainers, then we have no jobs which leads to more incentive and government programs, that us working people, can no longer afford. There are many, many ways to meet in the middle if the PARTY affiliations could work together instead of trying to outsmart the people who elected them with their sound bites or whatever or outsmart each other. DO THE JOB U R ELECTED TO DO or get out and let someone that really cares do it….
    WHY should elections cost so much so that ordinary citizens cannot afford to run and try to help out this STATE?! Many changes can be done without hurting everyone or a large percentage of the Mainers. There is enuf waste in government that could be curtailed but for some reason they are sacred or cash cows and nobody will initiate looking at these. There should be independent oversites on WELFARE, TAXES, etc. Citizens should be able to help work on these…get task forces to work on that do not include the politicians or just politicians at the very least or out of state groups interests that have nothing to do with what Mainers want.
    Sometimes the hardest changes are the easiest to implement if people would get out of the way and just work on these simpler easier items and tackle them first.
    Not every department in government, local or state or federal, needs an increase in budget….All should have a certain percent to decrease. Schools for one–I am not ANTI schools or giving our kids the best education available. But I am against a school dept feeling they HAVE to ask for an increase of (for example) 15% more than the previous year and then getting 10% and saying they were cut 5%. What the hell kind of math is that?! When I say decrease, I mean true cuts!! Most schools in our area are down in population 50% – give or take from the 70’s – yet the budgets are double and more than ever before and with two or three times more teachers and aides. WHAT the hell is that all about? Yet the end result is lower preparedness for our kids. Again task forces made up of non agenda provoked people is needed to look into these items. and that is in all DEPARTMENTS of government. Why are leaders so AFRAID to tackle this with a little more simplicity and less party oriented decisions. I know it not all simple, but the truth of the matter is, a lot of could be!!! Still proud to be a Mainer and and AMERICAN!!! But please don’t try to confuse us with rhetoric and sound bites….

  2. Judy Lizzotte says:

    Why are my comments above not being forwarded…If moderation needs to be done, what moderations are expected. No guidelines are here to instruct me. Or is the content not of the moderation you want to hear?

  3. Garrett Martin says:

    Judy,

    Apologies for the delay in approving your earlier message. We do moderate comments primarily to avoid all the spam comments that might otherwise be posted. As a result, there are sometimes delays between when a comment is submitted and when it appears. Thanks for chiming in.

  4. suzanne says:

    Can you can clarify some news I was told today:
    I was told that as long as you live outside of maine 6 months and 1 day, you can deem yourself a non resident and forgo paying any property taxes in Maine…… I recently stayed a rental cottage on the coast and every other property was owned by a non resident. If this is true, I am shocked that this happening and downright outraged as I continue to see my NON ocean front property skyrocket in taxes.

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