Panelists discuss Maine’s high taxes

DEXTER – There was no dispute among six panelists on Wednesday that Maine taxes are too high, although differing views were expressed about which taxes should be adjusted and how.

“We are way above average in taxes,” Rep. Doug Thomas, R-Ripley, said Wednesday, during a panel discussion sponsored by the Abbott Memorial Library. “Maine wages are low because our taxes are high.”

Thomas was joined at the meeting by state Sens. Paul Davis, R-Sangerville and Peter Mills, R-Skowhegan; Rep. Joshua Tardy, R-Newport; Christopher St. John of the Maine Center for Economic Policy; and Rob Brown of the Maine Citizen Leadership Fund, a nonprofit, nonpartisan, public policy research and advocacy group.

Each of the men gave their thoughts on state government, its problems and some solutions, but their voices offered little comfort to some participants.

“The thing that really gets me is why you folks in Augusta can’t get along,” Mike McCormick of Dexter said. “Why can’t you folks agree on what’s happening to our state?” He said he had to change the focus of his engineering career to school facilities because of the state’s manufacturing loss. State officials should be studying the root causes of that loss to reverse the trend, he said.

Carl O’Donnell of Parkman said young people are leaving the state and leaving its elderly behind, because there are no opportunities for them. “Come on guys, you gotta knock the taxes down,” he said. “Don’t make our eyes glaze over anymore. We’re dead taxwise.”

Brown said property tax relief is being addressed at the state level. “Maine’s tax system is skewed, and it’s skewed toward the property tax,” he said. “Property taxes are the real issue.”

The highest property taxes are paid by lower-income people, he noted. Property taxes provide 40 percent of Maine’s revenue, while 30 percent is derived from income taxes and 21 percent from sales tax, he said. Brown supports less emphasis on property taxes and more on sales taxes to capitalize on the tourist economy.

Health care costs for the elderly and those in social service programs help drive up the cost to live in Maine, according to Mills. He said property owners are paying the care of a “very high” level of dependent people. Maine is an aging state and its social service budgets are higher than most states. In fact, it has 43 percent more workers engaged in social service and in health care than the national average, according to the senator.

St. John also said that property taxes are too high based on where one lives and the disparities that exist. He does not support an across-the-board property tax relief package because a large portion of the property in the state is owned by nonresidents. “I would target relief to the particular households that have the problem,” he explained.

Taxes are too high because there are too many government employees, according to Thomas. Additionally, he said the state was not getting a good value for its education dollars and has a disadvantage because consumer electric rates are among the highest in the nation. He said Maine must do more to provide good jobs. If people could get decent jobs, there would be fewer welfare recipients, he remarked.

Tardy said the state must control spending but offered no Band-Aid solution to fix the tax structure. There is a need for a reliable and stable revenue source in Maine, but he said he is concerned about broadening the sales tax base, which affects owners of small businesses, especially on the state’s borders.

“I don’t like taxes, period,” Davis said. “I think that our taxes and our regulations are affecting use very deeply.” Maine is having difficulties because of taxation, regulation, high energy costs and, to some extent, foreign trade, he said.

“I think the state is very dangerously engaging itself in the health care industry,” Davis said. Explaining that comment further after the meeting, he said, “We have more people on MaineCare than we have children enrolled in public schools.”