Tax cuts passed by the Maine Legislature and Gov. Paul LePage over the past eight years will cost the state $864 million in revenue in the next biennium, according to an analysis by the Maine Center for Economic Policy and the Institute on Taxation and Economic Policy. At the same time the state continues to ignore its legal obligations to fully fund education, Medicaid expansion and revenue sharing. But the two think tanks also estimate that just $643.5 million would be enough to provide 55 percent of the cost of education to towns, expand health care coverage to 70,000 low-income Mainers and fully fund the state’s mandatory contribution to local services such as public safety, road maintenance, clean water and fire protection.

“Four rounds of income tax cuts in the past eight years have further tilted the [tax] code toward those at the top, allowing them to get out of contributing what they should,” wrote the report’s authors. “As a result, Maine will have almost $900 million less over the next two years than it would have had under 2010 tax law. That’s money no longer available to pay for things that benefit everyone — like education, health care and infrastructure.”

The analysis finds that over half of the revenue lost to the tax cuts will go to the top 20 percent of households. The top 1 percent received a $16,000 annual tax cut after the Legislature repealed the 3-percent surcharge to fund education, which voters passed in 2016. In a recent newsletter, Sen. Dana Dow (R-Lincoln Cty.), Senate chair of the Taxation Committee, who led the charge to repeal the surcharge, made the incorrect claim that the state is funding education at 55 percent. In fact, according to the state budget, the state is funding the cost of “essential programs and services” at 50.14 percent.

At the same time, because LePage and the Legislature made deep cuts to the state’s revenue sharing program, Mainers paid over $30 million more per year in property taxes between 2011 and 2016, according to MECEP.



To provide the necessary $320 million to fully fund public schools, $110.5 million for the state’s share of Medicaid expansion and $213 million to lower property taxes by restoring revenue sharing, MECEP recommends rolling back income tax cuts that benefit the wealthiest taxpayers, closing business tax loopholes and bringing back the inheritance tax on multi-million dollar estates. The organization has mailed its plan to the over 390 candidates for the Legislature as well as the gubernatorial candidates in an effort to get a head start on lobbying the future elected officials for a more progressive state budget.

“We think that this could be a transitional moment,” said MECEP spokesman Mario Moretto. “The winners have an opportunity to fully fund schools for the first time since voters pased the 55-percent requirement. We think they can seal the deal on health care and finally enact Medicaid expansion and appropriate the necessary funds to do that. And we think we can get legislators to fully fund municipal revenue sharing, which will not only improve services in communities, but it will drive down pressure on property taxes as well.”