Not the time for tax increases in Maine

By Doug Thomas, Special to the BDN
Posted March 03, 2013, at 12:29 p.m.

Remember the nursery rhyme “Old Mother Hubbard”? She went to the cupboard, and when she got there, the cupboard was bare. I don’t think I need to tell you, but Maine’s cupboard is bare. It’s time that federal, state and local governments figured that out.

In January, those in Maine who are fortunate to have a job found out when leaders in Washington said they wanted to tax the rich, they meant tax those who work. Recently Maine Revenue Services briefed the Taxation Committee in Augusta on the impact of the federal payroll tax increase. Its report concluded that the 2 percent increase will cost Mainers $355 million. That’s $355 million less working families have to stay warm and pay for necessities; it averages more than $500 per employee.

This increase could not come at a worse time for most families. Gas and oil prices continue to go through the roof, taking hundreds of millions of dollars from the pockets of hardworking Mainers. Every time we go to the store to buy anything the price is up, yet wages stay the same. It’s getting harder and harder for working people to make ends meet.

Before the end of this year’s legislative session, the Maine Legislature is required to pass a balanced budget. Just like the struggle Maine’s families are facing, state government has many challenges. State revenues are down; and if you look at the trends, they’re going to stay down for a while. The federal government has cut back on the money it provides Maine for programs they mandate. To make matters worse, they refuse to allow Maine to adjust spending on welfare programs so that we can fund programs at a level that’s sustainable.

The governor has proposed to the Legislature a balanced budget that spends the revenues that we’re projected to receive. The Legislature will make some changes, but in the end any changes must be balanced. Like Maine families, we can’t spend what we don’t have. Special interest groups are now lining up to be exempted from any cuts, and surely the sky will fall if their piece of the budget is reduced. Some groups claim that to solve the problem the state must raise taxes. How do we ask strapped Maine taxpayers to pay more in this economy? There’s no room in family budgets for higher taxes.

It’s not going to be easy to sort this out. We all need to understand there have to be reductions, and we cannot force Maine families to pay what they don’t have. The governor’s budget proposes to eliminate revenue sharing the state pays towns for the next two years. For many towns that’s a small percentage of their entire budget. For others the reduction would have a greater impact. The Legislature is going to do its best to find ways not to cut that much, but there will be reductions. Times are tough, and we need to work together at all levels of government to get through this. In the end, if we do it right and don’t raise taxes, we’ll be in a much better place when the economy finally starts to grow again.

Sen. Doug Thomas, R-Ripley, represents Senate District 27, which includes the Penobscot County communities of Chester, East Millinocket, Medway, Millinocket, Mount Chase, North Penobscot, Patten, Seboeis, Stacyville and Woodville. It also includes all communities in Piscataquis County and the Somerset County communities of Cambridge, Harmony, Hartland, Palmyra, Ripley and St. Albans.

http://bangordailynews.com/2013/03/03/opinion/not-the-time-for-tax-increases-in-maine/ printed on July 26, 2014