November 18, 2024
TAX REFORM DEBATE THE ONE PERCEN

Third tax cap option in the works Chamber leader suggests people wait until fall

AUGUSTA – The chief of the Maine State Chamber of Commerce is urging businesspeople considering a tax cap proposal that will be on Maine ballots in November to give the organization a chance to “place another option on the table.”

In a memo distributed this week, Chamber President Dana Connors suggested there could be a “third way” between maintaining the status quo and limiting municipal property taxes to 1 percent of a property’s value.

“Please wait until mid-September before you make up your mind on your position on tax reform this fall – I promise you, it will be worth the wait!” Connors wrote.

Connors, a leading voice in the unsuccessful effort to defeat a citizen initiative approved in June that requires the state to boost aid for public schools to 55 percent, said the Chamber has consistently held to a pro-tax relief position:

“Maine’s high tax burden must be reduced, and restraining the growth rate of all government spending is the best way to create the capacity for lower taxes.”

Broad legislative support for a particular approach, he acknowledged, has been elusive.

“These are remarkably difficult questions: questions that defeated the best efforts of state leaders in the last legislative session, and that remain unanswered today. But no matter what, answers will be given on November 2nd, when we all vote,” he wrote in his Aug. 3 e-mail message.

Connors did not spell out what an alternative to the proposed tax cap could look like, but referred to a 2002 report by the Institute for a Strong Maine Economy that he said “detailed the reality of our state’s tax problems, and called for simple, workable solutions that lowered taxes while respecting commitments by government to communities, businesses and those in need.”

Refocusing public debate on overall tax policy will take time, he said.

“We strongly believe that Maine tax policy is broken, and the passage or defeat of this fall’s tax cap will do nothing to solve our state’s underlying tax and spending problems,” Connors wrote.

The Chamber president said it would take four to six weeks to study the business impact of the proposed tax cap.

“When we announce our report on the proposed tax cap next month, we will also unveil a new approach to tax reform in Maine that directs lawmakers to break the political deadlock and reduce our taxes.

“Our plan will create a ‘third way’ on tax reform, transforming the current choices between a tax cap and the status quo by adding a new option to the debate,” Connors wrote.

In a brief telephone interview Thursday, Connors reiterated his view that tax reform will be needed no matter what the outcome of this fall’s vote.

“On November the 2nd, it’s not the end of the story,” he said.

Gov. John Baldacci, who opposes the tax cap initiative, has been talking on and off for weeks with ranking lawmakers about the possibility of a special legislative session this summer.

Viewed by some as a potential forum for tax policy changes, talks most recently have been said to focus on options for new state borrowing.


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