The Legislature’s Taxation Committee sifted through 62 bills this week. The following eight will be debated on the House and Senate floors. The committee unanimously supports the first five; it is split on the last three.

• An act to clarify the tax-exempt status of ornamental horticulture, which specifies that the exemption will be applied to products used in commercial agriculture production

• An act to enhance redevelopment of mill buildings, which aims to start an incentive program which could involve tax exemptions for those who occupy a mill building

• A bill to amend the Maine Residents Property Tax Program, or the Circuitbreaker Program, by including homesteads occupied by claimants that are qualified personal residence trusts.

• An act to change the circuitbreaker program so it is proportional if a resident moves.

• An act to exempt certain meals provided to food service employees from the sales and use tax.

• An act to add more language to protect the Housing Opportunities for Maine Fund.

• An act to reduce the income tax by requiring the state tax assessor to adjust the income tax rates and nontaxable income amount yearly using funds in the Tax Relief Fund for Maine Residents

• An act to support county government by allowing counties to adopt a limited special sales and use tax.

Flat tax, sales tax shift eyed

AUGUSTA – Ask any Mainer what their biggest issue is when it comes to public policy.

Most will respond: Taxes.

The Legislature’s Taxation Committee put in some late nights this week reviewing 62 bills falling under its jurisdiction. In addition, they are reviewing two tax-reform plans. One would lower the income tax to a 6 percent flat rate and then provide a series of tax credits, and another would drop that rate to 4.9 percent and increase the sales tax by a penny.

Committee member Rep. Randy Hotham, R-Dixfield, said the committee will likely make a final decision on the tax-reform plans next week. The committee is hoping to get both plans to the floor for committee review, one as an amendment to the other.

Rep. John Piotti, D-Unity and House chairman of the committee, has been making the rounds in the State House for nearly a month presenting the 6 percent flat income tax plan. Graphs show how people with low incomes will see an overall decrease because of savings through a new resident tax credit and repealing the “alternative minimum tax,” Piotti said. Those in high brackets will see a decrease because of the flat rate.

Corporate income tax options are still being discussed.

The plans also seek property tax relief by increasing state reimbursement and allowing municipalities to opt out or opt in to the nonreimbursed portions. Other possibilities include reactivating the state’s property tax deferral plan, which ceased in 1994, and allowing municipalities to keep 10 percent of future increases in sales tax.

Two of the bills the committee approved this week would alter the Maine Residents Property Tax Program, or Circuitbreaker program, in the residents’ benefit.

Making up the difference, however, has been controversial. Proposed tax increases could be applied to the following: real estate transfer, meals and lodging, and the excise tax on beer and wine. Piotti said other options could involve removing some exemptions or imposing a sales tax on some services.

He said the drive behind the meals and lodging tax is to increase the burden on out-of-state visitors, but officials from the restaurant and hospitality industries have been vehemently opposed to the idea.

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