The Peoples’ Veto of LD 1495
LD 1495 - Tax Reform and Tax Relief - was passed by the Legislature and signed into law by the governor in June of 2009. The title of this bill is misleading as it was designed to be “revenue neutral“, meaning no increase or decrease in tax revenues accruing to state government. This bill is very complicated, and has been analyzed by many competent authorities, including the Maine Revenue Service. All analysts agree that in the long run, LD 1495 will result in significant increases in taxes for most Maine citizens. But what is worse, is that it spreads the base of the sales tax (5%) to many services, which makes those who own and run small businesses de facto tax collectors with all the difficulties which that entails. Increasing the costs of services such as home and car repair, home maintenance, recreation and entertainment, and just about everything else that you can think of, will certainly not stimulate the economy, but instead do just the opposite - hamper the activities of those who create wealth and jobs, making more work for less profit.

The proponents of this bill are telling all through the media that they - the Democrats - have reduced the state income tax. This is again misleading as LD 1495 does not reduce the income tax. It reduces the tax rate from 8.5% to 6.5%, but at the same time, abolishes all exemptions and deductions, including the mortgage deduction. The end result is that taxpayers will pay a lower rate on a much higher taxable income. Therefore, there is no significant relief.

The proponents are also claiming that LD 1495 “exports” taxes to tourists by increasing the meal tax from 7% to 8.5%. But this will hurt Maine’s one viable remaining industry, tourism, and at the same time increase the burden on Maine people who eat out and vacation in Maine.

The Maine Republican Party, along with the Political Action Committee, Still Fed Up With Taxes, conducted a successful petition drive which culminated in handing in to the Secretary of State’s Office nearly 70,000 signatures last September. Despite many obstacles erected by the Democrats, this Initiative - The Peoples’ Veto of LD 1495 - will be on the ballot in June of this year, 2010.

For more information on LD 1495, go to www.stillfedupwithtaxes.net.

Maine Taxpayers United - true to Our Mission to reduce the tax burden - supports this Initiative and will be working throughout the spring campaign to ensure its passage by the voters.

The details of LD 1495 , from many different sources, are also available on our news web site: www.mainealliance.com.