Governor has chosen tax increases

"At this time, the governor is not interested in tax hikes," administration spokesperson Adrienne Bennett told the Sun Journal Thursday.

Actually, at this time Gov. Paul LePage is all about hiking taxes, property taxes.

While the governor may tell himself he is not proposing to raise taxes, when you start cutting tax discounts for property taxpayers you are increasing what they pay.

And that, in anyone's book, is a tax increase.

The governor has, among other things, proposed ending the Homestead Property Tax Exemption for those under 65.

That tax break is enjoyed by property taxpayers who have lived in their homes for at least 12 months and it is their primary residence.

Those property owners, which must be about 99 percent of us, get to knock $10,000 off our property assessments, which reduces our property taxes. The state then makes up the difference to the community.

End the exemption and taxes go up.

The governor has also proposed ending the Circuit Breaker refund that is enjoyed by about 90,000 Maine households.

Depending upon household income, homeowners and renters can receive a partial refund of property taxes up to $1,600. The average refund is $480 annually.

The 90,000 people who have received those refunds are certainly going it consider it a tax increase when they do not. The reduction would certainly exceed what these folks gained under the governor's income tax cut.

Then there are retailers like Shaw's and L.L. Bean that would lose their equipment tax reimbursements under the governor's plan.

They are smart people and will quickly see that their taxes are going up.

The governor's plan would require schools to pay a bigger share of their teacher retirement benefits. The bigger hit would apply to cities and towns that would lose millions of dollars in state revenue sharing.

While the governor's office likes to say each municipality is free to make its own decision about raising taxes, the reality is that either services must be cut or taxes increased.

This decision would come after years of cost cutting in municipalities across the state.

So, Gov. LePage is, this year, proposing raising taxes in order to protect the income tax cut he passed in 2011.

Critics at that time pointed out that the governor was setting the state up for a big fall two years later, but the warning was ignored.

Now, lo and behold, the governor cannot produce a balanced budget without increasing taxes for Maine's property taxpayers.

For years, people said all Maine had to do was cut waste and duplication in state government. We can assume the governor and his people have looked in every nook and cranny and cut what they could.

The reality now is they are unwilling or unable to cut the two biggest items in the state's budget, health care spending on the poor and K-12 education.

If there are no big cuts to be had, the only other option is to raise more money.

The governor would do that by raising property taxes. Democrats would repeal or slow the implementation of the income-tax cut, in effect a tax increase.

Others are talking about raising the lodging tax, which is now less than Connecticut, New Hampshire and Vermont, but higher than Massachusetts.

Maybe we should re-examine the soda and sugar tax that was rejected by taxpayers several years ago. Or we could increase the sales tax for two years to offset what the governor says is a temporary, two-year cut in revenue sharing.

The choice, it seems, is who should now fill the big hole in the state's budget by paying more taxes.

rrhoades@sunjournal.com

The opinions expressed in this column reflect the views of the ownership and the editorial board.

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Comments

Steve  Dosh's picture

Governor has chosen tax increases

l o l , 13.01.28 15:40 hst ? Thanks Rex ?
Yeah , Jon ; he's like most lawyers , he lies out of both sides of his mouth , selective memory , too . It is his fault . He has no clear mind of his own . He's a ƒish . He just goes with the current , like Mittsie . G O P approval rating = 26.2 % They are the .2% . We are the 99%
Q: How does a politician sleep ?
A : First he lies on one side, then the other
. . It's from the latin : " poly " meaning " many " and " tics " meaning blood sucking creatures . What health care does he use that you are paying for , Mainers ? Dirigo ® ? Just asking. .. After all he is the tallest hog at the trough . Watch him say he doesn't like Ombamacare® now . Just wait and watch . It hasn't even been implemented yet
Tax smokin' and drinkin' and gambling Canadians
Tax AK-47's and gun nuts to pay for health care
Education is our future because you can either earn a living or learn a living . Take your choice . Decide to decide ( not you Jon :)
Now go do your income taxes /s Steve

 's picture

Couldn't call it a surprise

Paul Krugman wrote this morning, "In the past, Republicans would justify tax cuts for the rich either by claiming that they would pay for themselves (they don't - my comment not Krugman's) or by claiming that they could make up for lost revenue by cutting wasteful spending (they can't the wasteful spending doesn't exist except in their minds - my comment not Krugman's). But what we're seeing now is open, explicit reverse Robin Hoodism: taking from ordinary families and giving to the rich."
Its not Gov. LePage's fault. He's only following the lead of National Republican Stategists at the Heritage Foundation. Poor people deserve to be poor because they are lazy, shiftless, and witless while rich folks are the drivers of economic growth and morality is what they believe. When will poor people in Maine stop voting for these people?

Amedeo Lauria's picture

The other option is to....

live within our financial means. Don't start something you cannot afford to sustain or that makes no financial sense; or that should be done at the lowest level. I do it as an individual and expect our government should do the same.

I grow weary of all this talk about taxpayers demanding services. It seems, we have developed a long long list of wants, and confuse them with public needs.

A few examples: We pay addicts mileage to get their methadone fixes. Parents no longer take their aging parents to medical appointments; we expect a tax subsidized agency to it. It goes on and on ad nauseum! The government has taken over the roles of family and community; at exorbitant cost we cannot continue to afford by raising taxes. Building 300K plus, low income housing! This adds up to millions and billions of dollars. There are of course too many examples to publish!

Municipalities continue to expand, after all when you expand the number of employees below you it is only fair that the top salaries increase as well. They even have organizations that advocate for them!

Public compensation exceeds private, on average. The system has been turned upside down and is unaffordable. We are just feeling it now due the impact of a sustained stale economy. Instead of asking how this happened and stopping it we want to continue an upward spiraling of local, state and federal taxes.

Conservatives with common sense must become politically active, run for office and turn this tax faucet OFF or we will be driven out of the state we love by ever increasing hands in our smaller and smaller financial pockets.

At least we seem to be having the discussion; I guess that's a good thing if we make the right decisions in the long term.

PAUL ST JEAN's picture

You state excellent points,

You state excellent points, Mr. Lauria. Well done.

Jason Theriault's picture

A retort.

First off - I have no problem with spending cuts. However, when you cut taxes without making spending cuts, you're only setting yourselves up for this. You go to LePages report on his first 500 days, and he brags about tax cut after tax cut.

You wonder why we have a deficit? It's because LePage turned off the the"tax faucet" years ago, but didn't bother to stop spending.

 's picture

It is simple ....

Undo the wrongful cut on taxes for the wealthy, and increase the sales tax by 1/2 %. Services are what make our society a better place for all to live, particularly through the educational system.
And yes some will abuse those services. Those who abuse the system need to be dealt with, and that too needs to be funded.
Cutting what makes us a better, and a good society un - does what we are.
From what I can see of this Lepage guy, he is coming un-done. He is the idiot, not the people he calls idiots.

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