(The Center Square) – Maine Republicans are criticizing a two-year, $11.3 billion state budget budget proposal that calls for raising taxes on corporations and altering the state’s income tax brackets.
The Democratic majority Legislature is poised to vote this week on the budget. The plan increases spending by 11% over the previous fiscal year to plug revenue gaps and a shortfall in the state’s Medicaid program and boosts funding for child welfare programs, housing, and other initiatives. It’s the second of two votes on the spending package, which received preliminary approval in March.
“This budget invests in Maine people,” state Rep. Drew Gattine, D-Westbrook, said at a recent committee hearing. “People who worry that their aging loved ones will have nowhere to go if their nursing home closes, people who depend on SNAP benefits even though they’re working full-time trying to make ends meet, and kids who rely on breakfast and lunch at school so they can focus on their studies.”
But Republicans, largely locked out of the budget process, say the spending plan is a “war on the poor” and are urging Democratic Gov. Janet Mills to reject the plan when it reaches her desk.
State Rep. Laurel Libby, an Auburn Republican, created an online petition criticizing the spending plan and urging voters to demand that Mills veto the proposal. Libby said the proposed tax increase would “push families, businesses and innovation creators out of the state, discourage entrepreneurship and upward mobility, and undermine Maine’s long-term economic competitiveness.”
“Now is not the time to take more money from the paychecks of hardworking Mainers,” she wrote in the petition. “Rather than adding to the tax burden, we should be working to phase out the state income tax altogether and foster an economy that rewards hard work, investment and innovation.”
The spending plan calls for increasing the top marginal corporate income tax rate to 10% on income over $3.5 million and adding two more income tax brackets for the highest earners, who would be taxed at 7.75% and 8.95% respectively.
Republicans have also criticized a cigarette tax increase in the proposed budget. Mills had called for a $1 per pack increase but lawmakers approved a $1.50 increase that would bring the total tax on a pack of smokes to $3.50. Other tax plans set new charges for internet streaming services, private pensions, and a 50-cent tax per gallon of paint sold in the state, to generate more revenue.
Senate Minority Leader Trey Stewart, R-Presque Isle, said Democrats “own” the budget deficit because they ramped up spending and have refused to show fiscal restraint in the spending plan.
“They have run out of your money, and now they want to raise taxes on Maine people,” Stewart said. “We’re not going to vote for it. But if they want to jump over that cliff, that’s on them.”
If Republicans vote against the spending plan, it could trigger a state law that requires budgets to be approved by a supermajority. Budgets passed by a simple majority don’t become effective until 90 days after the Legislature adjourns.
Another online petition by Republicans is gathering signatures for a “people’s veto” initiative to put a question on the ballot to overturn the budget. Supporters have until Wednesday to submit at least 67,682 signatures to qualify for the ballot, and it wasn’t clear if they had reached that threshold. Mills has urged Mainers not to sign the petition, warning of “serious consequences.”
“It would risk closure of Maine schools, hospitals, nursing homes, public colleges and universities, municipal offices, and bring road construction projects to a halt,” Mills said in a recent statement.
