Tax Answers Not on Ballot
Editorial

Tax Answers Not on Ballot


By BDN Staff
BDN Staff

The appeal of tax-related questions that will appear on the November ballot is deceptively simple: Vote yes and your taxes will go down. Unfortunately, reality is a bit more complicated.

The Secretary of State’s Office this week certified four issues to appear on the ballot after determining that backers had collected a sufficient number of signatures. One, called TABOR Now, is a new version of the Taxpayer Bill of Rights, which was rejected by voters two years ago. Like its predecessor, it would require voter approval of all tax increases and restrict growth in government spending.

Another question would reduce the state’s automobile excise tax.

A third seeks to repeal the school consolidation law.

The fourth would change the state’s medical marijuana law.

Backers of the first two questions promise that “tax relief is just one election away.” A catchy slogan, but one that denies reality.

Taxes have gotten a bad name. No one wants to pay them, but plenty of people want the services — paved roads, jails, protections for abused children, lakes stocked with fish — that they pay for. If the point of TABOR Now is to choke state government, it will succeed; the same is true of the excise tax cut for municipal government. If it is, as its backers say, an attempt to improve life in Maine, it will fail. A reasoned discussion of what services the people of Maine want to pay for — and how much they are willing to pay to maintain them — is not possible through a referendum campaign. This is the work the Legislature — the peoples’ elected representatives — is now doing to balance the state’s budget in response to dramatic revenue declines due to the national recession.

After being told for years that Maine’s tax burden was the highest in the country, last year it was revealed that Maine’s average state and local tax burden in 2008 was 10 percent of income, ranking the state at 15th, according to the Tax Foundation. More important, Maine’s tax burden is only slightly above the national average of 9.7 percent and it is moving downward, as it should be.

This does not mean that Maine’s tax burden is acceptable, but shows that it is not being ignored.

Further, the reality is that state government has been fiscally restrained over the last several years, and general tax increases have been avoided. Gov. Baldacci deserves credit for being the first chief executive in decades to actually reduce state spending. His proposed budget for fiscal years 2010 and 2011 totals $6.1 billion. The 2008-09 budget was $6.3 billion. If spending kept pace with the average increases in recent years, the next biennial budget would have totaled $6.8 billion.

In other words, he has more than met a requirement of the TABOR referendum that state budget growth not surpass inflation, plus population growth.

Municipalities also have met spending caps that were part of the law requiring the state to fund 55 percent of education, which required that state to spend close to an additional $1 billion on kindergarten through 12th-grade education — money that was meant to lower municipal taxes.

Schools, by the way, continue to consistently exceed the spending caps, yet a ballot question seeks to repeal the consolidation law that most school districts are implementing. The law certainly has flaws, but schools have not earned the public’s trust when it comes to reining in spending.

The November ballot also is likely to include bond requests for infrastructure work and research and development. What bitter irony it will be if backers of the tax and spending reform measures oppose borrowing money to boost employment — the surest way to ease the state’s tax burden by raising incomes.

As past efforts have shown, tax reform is difficult work. Trying to short-circuit the process through ballot questions will only shortchange the state in the future.

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Comments
12 comments on this item

WWWHHHHHAAAAAAATTTTTTTT! Governor Baldacci has done a good job reigning in spending?! Are you kidding? Gov. Baldacci has done everything to increase the tax burden just to balance the budget and some of his poorly managed pet projects. The report that says that Maine only has a 10% tax burden did not include some major issues. I can go to NH and rent an apartment and have a tax burden of 0%, and employers like to go to NH.

Examples you say?

1. Increase in cigarette tax of $2.00 a pack, to fund the poorly managed Dirigo health care.

2. Increase in fines for speeding tickets, the fines have doubled in some cases.

3. Gas tax in Maine is 27.6 cents per gallon, in NH it is only 18 cents per gallon.

4. Dirigo tax which is 2.408% of all health insurance claims, for a program that doesn't work.

5. Excise fee on a new automobile is $24 per $1000. You have to pay $600 just to register a new vehicle work $25K.

6. 8.5% income tax on everyone that makes over $18,951 dollars a year. Someone that makes $19K a year can barely buy the necessities.

7. Sales tax of 5% of everything you purchase at the grocery store.

8. Inflammatory property taxes.

What would help the state balance the budget is simple.

1. Follow NH as a lead. NH legislators and senators are paid $100 each and the session is only two weeks long. All Maine state senators have 100% health insurance by the state.

2. The state is the biggest employer....How about cutting state services to four days a week? That would save some money.

3. Let's not vote for every bond issue that shows up on the ballot.

4. Let's not spend time in the legislature coming up with more stupid common sense laws. They obviously have to much time on their hands.

5. Let's not spend money that we don't have. People in this state have to go without food just to buy fuel oil.

No one is trying to short cut tax reform they are just trying to give more power to the people by being able to control the spending of the gov't. It has been shown that the elected legislators can't perform the task.

The tax answers are not on the ballot, but they certainly aren't in Augusta either. Everyone will use their scare tactics so that they can save their little pc of the pie. You won't get your road paved.....You won't get your medicare....You won't get your welfare check.....OH NO!

I don't know who wrote the article here, but get your facts straight before spewing lopsided opinions.

Cars and cigarettes SHOULD be taxed at higher rates. The cigarette tax still does not cover the health costs brought about by smoking. The private car is the most heavily government-subsidized form of transportation there is. Let car owners and smokers pay the true costs of their habits. I don't see how speeders can complain about their fines. Don't speed if you don't want to pay it. Next thing you'll be complaining about is the high cost of lottery tickets.

if we are going to raise taxes for health care according to who uses the the most healthcare dollars we must raise taxes on fattening foods on old people not just on people and things we dont like. its about the goverment stopped spending money it doesnt have. gov baldacci thinks he is obama just raise taxes and we can cure averybodys problems but pretty soon nobody will prosper.

" Taxes have gotten a bad name." Of course you fool. High taxes mean everyone has less money in thier pocket. High taxes lead to lower private growth rates . High taxes cause people to get laid off. High taxes cause big and medium size companies to flee overseas. High taxes send power to Augusta and out of the hands of local communities and High taxes will be part of the reason when the BDN finally closes down.

Another plea by the editors of Pravda on the Penobscot to support the filth, rot, and corruption that is the very essence of Maine state government -- garbled by the inability of the BDN's editors to remove their lips from the governor's buttocks.

If you are sick and tired of the status quo in Augusta, and are ready for some positive changes in Maine, please visit Maine Taxpayers United at www.mainetaxpayers.com

Stop and think, you tax-haters...when taxes go down, essential services get cut! What do you think pays for things like road repair, fire service, etc? That's what taxes are for.

School consolidation is not just about capping funding. First the state has never met its commitment to cover 55% of education costs. The state actually only covers around 50% of costs. The state also gives out school funding based on the EPS (Essential Programs and Services) formula which has shifted subsidy away from rural schools to urban ones. The EPS formula when originally enacted was supposed to be a minimum level of school funding. Since LD 1 passed, it has been used as a cap.

School consolidation has been suggested as savings $240 million initially yet figures based on plans passed PROJECT a savings of $1,636,000. The law does not save any money, increases or shifts local costs, and gives the state more control over education. It also creates problems for the new school distrcits that receive only one subsidy check to be split amongst the school. Finally, when voting for these plans, voters were given the choice of voting for a plan or taking the subsidy penalty. The idea of voting on something and given a choice between voting for something or voting no and taking a penalty is unAmerican and undemocratic. The repeal vote at least gives citizens an up or down yes or no vote without penalties. Something we should have had in the first place!!

This response is to "hankwilliams."

Hank, first of all, I pay my own health insurance. My argument for the cigarette tax was how the money was spent on a health care subsidy that did not work. Last time I checked it cost $300 million dollars just to institute. $300 million should be enough to buy everyone in the state health care, not subsidize a select few that couldn't afford it before.

Second, How is my car subsidized by the Augusta? I paid for it, put the gas in it, and pay for my own maintenance...... I don't think Augusta has subsidized my automobile at all.

Third, I always pay my speeding tickets. I am complaining about the outrageous rate which Maine charges for a moving violation, not that there is a fine imposed. Some people believe a hungry person that steals a loaf of bread should have their hand cut off, but according to your argument they shouldn't complain.

Fourth, I don't buy lottery tickets, because the money goes to the state and they already take enough of it.

I like your debate, but your weak logic could not change my mind.

sebec39 taxes are all well and good but the term "essential services" has come to mean anything the government wants it to mean. They are robbing you.

If people want to smoke let them pay for their own health ins.. at a higher rate....I did not force them to stick a cig in their mouth......and while we are at it lets make men and women who live off the state.....more responsible.....As for a car in maine, it is a necessity hankwilliams........maine is very rural and if you want me to work and pay my taxes and pay for all the welfare programs available ....

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