Last week Maine residents voted to repeal tax-reform legislation that would have added sales tax to self-storage as well as 101 other services.
 
A tax-reform package that would have lowered the state’s income-tax rates in exchange for adding a sales tax to dozens of previously exempt items and raising the meals and lodging tax was rescinded on June 8 with a 61 percent majority. Supporters of the law, passed last year, said it would shift the bulk of the tax burden to tourists. Opponents countered by saying residents would have to pay tax on many everyday purchases such as movie tickets, hair cuts and car repairs. Some also said it would eventually mean higher income taxes for most residents, except for the very rich.
 
Signed by Gov. John Baldacci in June 2009, the law added a 5 percent sales tax to self-storage and several of the state’s services and increased the meals and lodgings tax from 7 percent to 8.5 percent. It reduced the income-tax rate from 8.5 percent to 6.5 percent for those earning less than $250,000 per year, and from 6.85 percent versus 6.5 percent for those earning more.
 
Sources:
 
The Portland Press Herald, Maine Voices: Repeal of tax bill will keep Mainers from paying higher taxes

Bloomberg Businessweek, Vote doesn’t mirror Mainers’ desire for tax reform

Foster’s Daily Democrat, Feelings mixed over Maine’s repeal of tax reform

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