LOCAL SALES TAX OPTION IS SIMPLY A WAY FOR MAINE LAWMAKERS TO EXPORT TAX BURDEN
AUGUSTA (April 16, 2015): Today the National Federation of Independent
Business (NFIB) is speaking out against a proposed tax increase for Maine small
businesses. A hearing is being held in front of the Committee on Taxation to debate
the merits of tax increases via municipal referendum and small business
presented comments at a hearing today to educate lawmakers on the dangers of
the legislation.
“The flaws with allowing a local option sales tax are
numerous and they place the burden on the residents of our state who we already
are already paying too much.” Said NFIB Maine State Director David Clough. “Just
when the economy is beginning to, albeit very slowly, make a comeback, law
makers are considering increasing the costs of essential items that will
further damage the bottom lines of both small businesses and tax payers.”
LD 594 would permit a municipality to impose a tax of up to
1% on the sale of goods and services if approved by a referendum of voters of
that municipality. The tax would be
imposed on top of the State’s general sales tax.
“Towns that are fortunate enough to have a significant
retail base may not feel the need to impose such a referendum but those who do
not may unfortunately see this as an option and wind up encouraging people to
shop outside of their local markets.” Continued Clough, “This will clearly
result in businesses looking to relocate to more fiscally friendly
municipalities.”
David Brunori, a noted tax authority wrote in the March 9.
2015 issue of State Tax Notes that, “(L)ocal option sales tax… afford(s)
politicians the ability to export tax burdens…It will be people in the
surrounding suburbs and rural areas who pay some of the tax…I am unsure why a
legislator from a rural area – or even an area without significant retail –
would support this measure. Their
citizens will pay but won’t see the benefits.”
