An Act To Implement Tax Relief and Tax Reform
FILED UNDER: Tax Related | Passed | 2010
Summary
This bill replaces LD 1088 and incorporates changes suggested by Governor Baldacci. This bill has been passed and was signed by the Governor.
Position
(UPDATE: January, 2010 - This bill has been successfully petitioned as a people's veto for the June 2010 ballot. As such, all provisions of this bill are on hold until the June vote.)
We vigorously opposed this package as it will harm small businesses by expanding the sales tax to over 100 new items. In a difficult economy, the expanded taxes will continue to hurt business recovery.
Changes from LD 1088:
This bill incorporates the substance of Legislative Document 1088, "An Act To Modernize the Tax Laws and Provide over $50,000,000 to Residents of the State in Tax Relief," as amended by Committee Amendment "A" and House Amendment "A" to Committee Amendment "A" with the following changes.
1. It enacts an income tax surcharge equal to .35% on taxable income over $250,000, bringing the tax rate to 6.85% on Maine income over $250,000. The tax surcharge applies to tax years beginning on or after January 1, 2010.
2. It eliminates the Maine minimum tax credit for individuals that may be claimed on returns due for tax years beginning on or after January 1, 2010. The credit still applies with respect to taxable corporations.
3. It makes the earned income tax credit refundable for tax years beginning after 2009 up to $150 for taxpayers filing married joint returns and $125 for all other taxpayers. Under current law, the credit is not refundable.
4. It eliminates the proposed real estate transfer tax increase.
5. It eliminates the proposed sales tax exemption for businesses that make snow for skiing, snowmobiling or similar activities of electricity or fuel used to make snow, machinery or equipment that is used for making snow and snow-grooming equipment.
6. It eliminates the proposed sales tax on fees charged for golf courses, bowling alleys, swimming pools, skating rinks, ski lifts, gymnasiums and tennis and racquetball courts and on proceeds from arcade games.
7. It specifies that the exemption from sales tax applies to fees charged by health and fitness centers and lessons or training in dance, music, theatre, arts and gymnastics, martial arts and other athletic pursuits.
8. It increases the amount that is deposited into the Tourism Marketing Promotion Fund from sales tax on meals and lodging.
9. It allocates funds to the Tourism Marketing Promotion Fund due to the increase in the percentage of certain sales tax revenue that is transferred to the fund.