After reading the article by Naomi Schalit and John Christie about the Business Equipment Tax Reimbursement Program (Sept. 19), I couldn’t help but respond because I think they truly have it all wrong.
While the business community has been, and continues to be a strong supporter of the BETR program, businesses alone have not been the only beneficiaries — Maine workers with Maine jobs have also benefited.
I would argue BETR is not a “cost to taxpayers,” as alleged in the article, but an important investment in Maine’s economic future that helps retain Maine jobs while allowing Maine businesses to remain competitive in the global economy in which they operate and compete.
The Legislature enacted the BETR program back in 1995 to help put Maine businesses on a level playing field with other states that either did not tax personal property at all, or did so at much lower rates. The enactment of BETR followed three studies by the Legislature: the 1990 Report of the Select Commission of Comprehensive Tax Reform, the 1993 Report of the Maine Economic Growth Council and the 1995 Report of the Commission to Study the Future of Maine’s Paper Industry. Each recommended the elimination of the personal property tax.
And why not? Time and again those taxes were cited by Maine businesses as a disincentive to invest here — to create jobs here — to keep their companies here.
In the Northeast region alone, personal property is not taxed in New Hampshire, Massachusetts, Rhode Island (local option), New York, Pennsylvania, Delaware, Vermont (local option) and New Jersey. Many of those states are Maine's direct competitors regionally, nationally and globally.
In addition, BETR only applies to taxes paid on equipment placed in service after April 1, 1995. There is still personal property investments made prior to 1995 that continue to be taxed by local municipalities today.
Former Gov. Angus King is correct about the fact that more than a billion dollars of investments have been made since the enactment of BETR. In fact, former state economist, and now Thomas College President Laurie Lachance, in her white paper titled “Maine’s Investment Imperative,” cited that about the same time the BETR program was enacted in 1995, Maine’s industrial sector showed the productivity of industrial workers tripled and has continued to accelerate since.
To achieve such acceleration, she said, "a spate of investment had to have taken place.” Given the job growth that took place in the shipbuilding and high tech industries during that time, we would dare say the results should be obvious to those willing to look at the issue with an unbiased or non-predetermined eye.
Through the years, the Legislature’s Taxation and Appropriations Committees have heard countless businesses testify as to the effectiveness of BETR in job retention and helping Maine businesses attract the necessary capital to keep competitive. In some cases, yes jobs have been created, but more importantly, jobs have stayed here in Maine, and we have been able to be more competitive.
Schalit and Christie give readers the impression that these companies take everything and give nothing. We would strongly argue just the opposite.
Companies that receive BETR provide thousands of direct paying jobs but also provide thousands more in indirect jobs in their communities. Schalit and Christie fail to mention the fact that all of these companies combined spend tens of millions of dollars on goods and services in Maine, thereby contributing directly to Maine’s regional and statewide economies, thus providing a multitude of indirect jobs that depend on these industries for their communities' and families’ livelihoods.
The Legislature and the state must continue to do everything in their power to enact reasonable policies that allow Maine businesses to remain competitive, grow their businesses, and create jobs and opportunities for our citizens.
We are living in a truly global marketplace, a fact we cannot ignore. We must do everything to give companies the tools they need to compete on a global basis. States that do this will win. States that don’t may be left fighting for the economic scraps.
Maine not only cannot afford to lose any investment to another state, it cannot afford to lose the opportunity to compete for any investments to another state. Failure to operate on a level playing field with other states translates into losing investment and losing jobs, it is that simple.
That is what BETR has, and will continue to provide Maine and our people.
Linda Caprara is director of grassroots advocacy for the Maine State Chamber of Commerce.