BANGOR – The Bangor Region Chamber of Commerce became the latest business group in Maine to support a recent tax reform measure by endorsing a ” no” vote on Question 1.
The Chamber’s board of directors voted Thursday on the endorsement with the belief that tax reform promotes growth and brings the state’s tax system more in line with other states. The Chamber supported the bill last year when the measure made its way through the Legislature.
“Little has changed since the Chamber last examined this issue,” said Michael Ballesteros, chairman of the Chamber’s board of directors. “Maine still has a top income tax rate that is too high, a narrow sales tax base and a meals and lodging tax that is low when compared to many other states.”
Question 1 reads: “Do you want to reject the new law that lowers Maine’s income tax and replaces that revenue by making changes to the sales tax?”
The law, LD 1495, lowers Maine’s top income tax from 8.5 percent to 6.5 percent for all residents earning less than $250,000 a year, although in some cases, the rate will be even lower. To make up for the lost income tax revenue, the bill broadens the state’s sales tax to more categories of goods and services and raises the meals and lodging tax from 7 percent to 8.5 percent.
A no vote on Question 1 already has the support of the Portland Area Chamber of Commerce and the Maine State Chamber of Commerce. The Maine Innkeepers Association and the Maine Restaurant Association are among the groups opposing the tax reform plan.
A recent poll by Critical Insights, a Portland-based market research firm, suggested that Mainers are divided on tax reform. The poll released on Thursday found 43 percent in favor of keeping the law, while 38 percent said they would do away with it. Nineteen percent were undecided. The poll was based on 600 phone interviews from April 28 and May 7 and has a margin of error of 4 percentage points.
The Bangor Chamber’s support of the tax reform measure is not unqualified. Members still believe that the overall tax burden in Maine is too high and that Maine government must restructure and learn to do more with less.
“The debate over taxes in Maine is far from over,” Ballesteros said. “But a ‘no’ vote on Question 1 will advance that debate in the right direction, and for that reason, we stand by the tax reform plan.”
Also on Thursday, the Chamber’s board of directors endorsed all four of the bond issues that will appear on the June 8 ballot.
“Though we are aware that, in these times, the state has to spend its money carefully, these projects should contribute to the overall economic well-being of Maine,” said Ballesteros. “While there is much work to do with restructuring Maine government and lowering our tax burden, the state’s track record on bond packages has been a reasonable one.”
The bonds include:
. A $26.5 million package supporting offshore wind research and energy efficiency initiatives at the state’s colleges and universities.
. A $47.8 million transportation bond that includes money to preserve rail assets in Aroostook County as well as fund improvements to port and highway infrastructure.
. A $23.75 million bond funding community economic development, including conversion of the Brunswick Naval Air Station to civilian uses.
. A $10.25 million bond to fund water quality projects and wastewater management infrastructure.
The Associated Press contributed to this story.
erussell@bangordailynews.com
990-8167