Vote Smart's Synopsis:

Vote to pass a bill that adjusts taxes in Maine to reduce income tax for residents, and that compensates for the resulting loss of revenue by increasing various other taxes.

Highlights:

-Lowers the Maine income tax to 6.5% at all income levels (Sec. A). -Allocates base household credit as follows: $700 for single individuals; $1,050 for unmarried individuals filing separately or as heads of households; $1,200 for individuals filing married joint returns or surviving spouses entitled to file a joint return; and $600 for married persons filing separate returns (Sec. A). -Provides that the base household credit may be increased by $250 for each person for whom the individual filing the return is entitled to claim an exemption (Sec. A). -Reduces the base household credit by $1.50 for every $100 that the individual's taxable income exceeds the following levels: $27,500 for single individuals and married persons filing separate returns; $41,250 for unmarried individuals or legally separated individuals who qualify as heads of households; and $55,000 for individuals filing married joint returns or surviving spouses permitted to file a joint return (Sec. A). -States that progressive rates of tax credit are necessary to combat the high prices of heating oil, the high cost of transportation due to low availability of public transportation, disproportionate levels of state and local taxes, and the high rate of local property taxes (Sec. A). -Extends sales taxes to service industries, including overnight lodging rentals; entertainment, amusement and recreation; installation and repair; transportation and courier services; and all personal property (Sec. B). -States that all services and personal property sales are taxed at 5%, with a few exceptions including trailer rentals, which are taxed at 7%; liquor, prepared food, and hotel rental sales, which are taxed at 8.5%; and automobile rentals, which are taxed at 12.5% (Sec. B).

Full Bill Text

Vote Smart's Synopsis:

Vote to pass a bill that adjusts taxes in Maine to reduce income tax for residents, and that compensates for the resulting loss of revenue by increasing various other taxes.

Highlights:

-Lowers the Maine income tax to 6.5% at all income levels (Sec. A). -Allocates base household credit as follows: $700 for single individuals; $1,050 for unmarried individuals filing separately or as heads of households; $1,200 for individuals filing married joint returns or surviving spouses entitled to file a joint return; and $600 for married persons filing separate returns (Sec. A). -Provides that the base household credit may be increased by $250 for each person for whom the individual filing the return is entitled to claim an exemption (Sec. A). -Reduces the base household credit by $1.50 for every $100 that the individual's taxable income exceeds the following levels: $27,500 for single individuals and married persons filing separate returns; $41,250 for unmarried individuals or legally separated individuals who qualify as heads of households; and $55,000 for individuals filing married joint returns or surviving spouses permitted to file a joint return (Sec. A). -States that progressive rates of tax credit are necessary to combat the high prices of heating oil, the high cost of transportation due to low availability of public transportation, disproportionate levels of state and local taxes, and the high rate of local property taxes (Sec. A). -Extends sales taxes to service industries, including overnight lodging rentals; entertainment, amusement and recreation; installation and repair; transportation and courier services; and all personal property (Sec. B). -States that all services and personal property sales are taxed at 5%, with a few exceptions including trailer rentals, which are taxed at 7%; liquor, prepared food, and hotel rental sales, which are taxed at 8.5%; and automobile rentals, which are taxed at 12.5% (Sec. B).

Full Bill Text