AUGUSTA – The Senate’s majority leader said Friday there is growing support for a 1 cent increase in the state’s sales tax as a way to fund property tax relief.

“There is consensus around raising 1 cent on the sales tax; there does seem to be support for that,” said Senate Majority Leader Sharon Treat, D-Farmingdale.

At least one leading Republican said the plan won’t fly. House Minority Leader Joe Bruno, R-Raymond, predicted GOP members would reject the initiative. “Absolutely not,” Bruno said. “You don’t raise taxes to lower taxes. That’s stupid.”

Raising the sales tax from 5 to 6 cents per $1 would generate about $130 million a year, Treat said. A Democratic plan may also include mandatory spending caps for state and municipal governments, something Republicans favor. However, Treat said she doesn’t want to amend the Constitution to set the spending caps in place, as Republicans want. She’d prefer the caps be passed through statute.

With less than two weeks left before the scheduled adjournment April 21, Treat said she’s optimistic about a property tax relief plan passing. “I’m totally energized. I’m motivated,” Treat said. “I know time is short. We will have to pull it together next week.”

Treat said there also seems to be public support for raising the sales tax 1 cent if that money is used to lower property taxes. Once the public understands the proposal would reduce individual property tax bills by $500 to $1,000, “we should have a good chance of beating (Carol) Palesky’s tax cap proposal.” Palesky’s referendum proposal would cap property taxes at 1 percent of the property’s assessed value.

House Speaker Patrick Colwell, D-Gardiner, agreed Friday that Democrats are uniting “in putting forward a major property tax plan.” He said Democrats are “very seriously considering” raising the sales tax by 1 cent.

If a proposal emerges next week, “we need to make sure it does decrease the (property) tax burden. We’re interested in improving the business climate and will be working with the Chamber of Commerce,” Colwell said.

The success of the plan will include getting Republicans and Gov. John Baldacci on board, potentially a hard sell.

Maine’s property taxes are among the lowest in the country, Republican Bruno said. “The issue is state taxes.” Raising one tax to lower another comes from people “who have no idea how the economy works. It’s silly,” he said.



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