Tax Choices

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Below are some of the hundreds of tax exemptions Maine currently offers and the amount of revenue they would have provided to the state this year. To pay for Question 1A without cutting other state programs, exemptions worth $245 million would have to be removed in the first year.

As you can see, there are plenty of places from which to choose – each with a constituency that would object. Dozens more sales-tax exemptions aren’t listed here because they would amount to so little revenue, but for the exacting, exemptions also exist for fish-passage facilities, farm animal bedding, portable classrooms, eye banks and credit for worthless accounts among many others. Where there is a broad range listed for the amount of revenue expected, it is because the Maine Revenue Service did not have adequate information to be more specific.

So whom would you tax?

Separately charged labor service fees, $23 million

Tips given directly to employees, $847,937

Various telecommunications services, $12,790,416

Exemptions by constitutional provisions, $1 million to $3 million

Certain government entities (such as towns), $114 million

Grocery staples, $112 million

Ships’ stores, $250,000-$999,999

Medicines, $32.8 million

Prosthetic devices, $1.4 million

Certain motor fuels, $63 million

Jet fuel, $1.5 million

Coal, oil and wood, $21 million

Residential electricity, $11 million

Residential gas, $8 million

Fuel and electricity used at a manufacturing facility, $29.8 million

Packaging materials, $11 million

Publications, $4.7 million

Hospitals, research centers, churches and schools, $6 million or more

School living quarters, sleeping or housekeeping accommodations, $3 million to $6 million

Rental charged to any person who resides continuously for 28 days at any one hotel, rooming house, tourist or trailer camp under certain conditions, $128.6 million

Certain vehicles purchased by nonresidents, $250,000-$999,999

Funeral services, $3 million

Nonprofit fire departments and nonprofit ambulance services, $50,000- $249,999

Community mental health facilities, community mental retardation facilities and community substance abuse facilities, $50,000-$249,999

Water pollution control facilities, $250,000-$999,999

Machinery and equipment, $24.7 million

Diabetic supplies, $484,853

Coin-operated vending machines, $754,017

Residential water, $5 million

Mobile and modular homes, $3 million

Nursery schools and day care centers, $50,000-$249,999

Food stamp and WIC purchases, $462,769

Nonprofit youth organizations., $250,000-$999,999

Construction contracts with exempt organizations, $1 million-$3 million

Schools and school-sponsored organizations, food, books, clothing, $250,000- $999,999

Seedlings for commercial forestry use, $50,000-$249,999

Property used in production, $242 million

Meals and lodging provided to employees at their place of employment, $1.8 million

Sales of property delivered outside this state, $6 million or more

Trade-in credits used toward the sale price of another of the same kind of certain motor vehicles including tractors, watercraft, aircraft, lumber harvesting vehicles or loaders, $28.8 million

Refund of sales tax on depreciable machinery and equipment purchases, $4.5 million

Personal services such as haircuts and other services provided by barbershops and beauty parlors, health clubs services, cleaning, laundering, pressing and alteration services, $9.8 million

Business and legal services, $12 million

Amusement and recreational services, $28.3 million

Health services, $25.8 million

Educational services, $43.9 million

Finance, insurance and real estate services purchased by consumers, $75 million

Finance, insurance and real estate services purchased by businesses, $142.7 million

Transportation services purchased by consumers, $10.7 million

Transportation services purchased by businesses, $49 million

Other services purchased by businesses, such as advertising, legal, management, public relations, research, development and testing, $174 million

Gasoline exported from the state, $51.5 million

Gasoline shrinkage allowance, $738,598

State & Local Government Exemption from the Special Fuel Tax, $2.6 million

Fuel Used Solely for Heating or Cooking, $13.5 million