AUGUSTA – The average property tax relief that Mainers can expect this year from legislation approved last month is $328, considerably more than first reported, according to a new analysis by Maine Revenue Services.

“The first study only took into account the EPS (Essential Programs and Services in the school funding formula) and did not figure the circuit breaker or the Homestead Exemption,” said Mike Allen, director of the Economic Research Division at Maine Revenue Services. “There is a significant benefit when those are added in to the analysis.”

The first study indicated the average benefit would be $207. Allen said it is important to understand that the analysis uses average numbers and that an individual homeowner could see a significantly greater cut or a lesser cut in a property tax bill.

Sen. Peter Mills, R-Cornville, who also served on the property tax reform committee, said he believed the original estimate of savings was low because the “major engine” for relief of many property tax payers will be the circuit-breaker program.

That provision increases the maximum refund to $2,000 and limits the maximum property tax allowed to $3,050 for single-member households and $4,100 for multi-member households.

But, Mills cautioned, the analysis is limited and does not reflect that some communities may actually see a slight increase in their tax rate to pay for the Homestead Exemption.

“That is the $6,500 of the $13,000 exemption that is not paid for by the state,” he said, “that is $36 million that will be shifted to other property tax payers in every city and town other than homeowners.”

Mills said that shift to business and commercial property as well as second homes varies widely from one town to another.


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