AUGUSTA, Maine — As Maine’s legislative leaders continued their ongoing negotiations on a new two-year budget that must be in place by July 1, Republican Gov. Paul LePage on Friday renewed his push for the new budget to do away with the state’s estate tax.

LePage and his conservative allies call the tax paid on inheritances in Maine valued at over $2 million a “death tax.”

In his budget proposal LePage cut the tax, but a bipartisan budget deal now on the table would increase the exemption on the tax to $5.5 million, aligning Maine’s estate tax with the federal government’s.

In a statement issued Friday morning, LePage said the tax in Maine contributes to only 1.3 percent of the state’s total revenue, or only enough money to fund government for four days.

“In order for Mainers to prosper, we must take on tax reform in a meaningful way. We do that by eliminating the burden of the death tax and reducing personal income tax,” LePage said in the prepared statement.

Legislative Republicans who support LePage said the tax in Maine often hits family farms that are often “land rich and cash poor.”

LePage said if Maine were to eliminate the tax, it would join Arizona, North Carolina, Ohio and Oklahoma in repealing an estate tax.

During a series of town hall-style meetings held earlier this year, LePage repeated a story of being contacted by former Maine residents who now live out of state who told him if the state repeals the tax, they will move home.

“Pro-growth tax reform creates a stronger economic recovery, putting us in a better position to grow, with more investment, more jobs, higher wages and a better standard of living,” LePage said in his statement.

But legislative Democrats, who control the House of Representatives, are leery of completely eliminating the tax, which brings in a variable amount of revenue to the state each year, depending on who happens to die that year.

Democrats argue cutting state revenue further only puts pressure on other parts of the state’s budget, including funding for public education and services provided by the Maine Department of Health and Human Services.

Jodi Quintero, a spokeswoman for House Speaker Mark Eves, D-North Berwick, said Democrats are opposed to eliminating the tax.

“We oppose the estate tax cut because it helps only a few wealthy families compared with all of Maine,” Quintero said. “This is a Republican priority.”

Scott Thistle

Scott Thistle is the State Politics Editor for the Lewiston Sun Journal. He has covered federal, state and local politics in Maine for nearly two decades.