Fed up and low down

For once, the beleaguered taxpayers of Maine can’t lose
By AL DIAMON  |  April 21, 2010

On one side of the issue, there’s a group called “No Higher Taxes for Maine.” On the other side, there are two organizations: “Still Fed Up With Taxes” and “Vote Yes to Reject New Taxes.”

The tax question on the June ballot appears to pit fiscal conservatives against fiscal conservatives. For once, the beleaguered taxpayers of Maine can’t lose.

Just kidding. Of course they’ll lose.

Despite these political action committees’ tight-fisted titles, none of them has the slightest intention of reducing your taxes. In fact, all the participants actually claim they’re in favor of maintaining the status quo, although one side is promising a status quo that will screw over a slightly different bunch of people, while the other side is in favor of continuing to screw over the same folks.

Which choice you make between these unattractive alternatives could come down to credibility. But since both camps are about as believable as Bigfoot sightings, a solid argument can be made for skipping this question altogether and moving on to the lies being told about the bond issues and gubernatorial candidates.

Nevertheless, I’ll attempt to explain tax reform, using easy-to-understand phrases, such as “fundamentally misleading,” “deliberately inaccurate,” and “twisted in ways that are unappealing, uncomfortable and, quite possibly, unnatural.”

Last year, Democrats in the Legislature passed a bill that reduced the state income tax from a maximum rate of 8.5 percent (which nearly everyone pays on most of their income, because Maine’s tax brackets are about as progressive as a Tea Party convention) to a flat rate of 6.5 percent for all but the richest taxpayers. To cover the resulting loss in revenue, the measure calls for broadening the sales tax to cover some products and services that had previously been exempt, and raising the meals-and-lodging tax from 7 to 8.5 percent.

Republicans opposed the bill, because . . . well, mostly because it was supported by Democrats. For decades, the GOP, both locally and nationally, had advocated in favor of replacing taxes on income with taxes on consumption, on the grounds that such a system gave people more control over how much they paid the government. For just as long, Democrats opposed the idea, claiming it would harm the poor and benefit only the wealthy. Sometime in the last decade, the parties got bored making the same old arguments and agreed to swap positions.

Before the bill became law, Democratic Governor John Baldacci tinkered with it to make it fairer, by which he meant fairer for ski areas and people who sell mansions, both of which were exempted from the expanded sales tax for the very good reason that they were represented by high-priced lobbyists who were close allies of the governor.

Once Baldacci signed this much-improved version of the legislation into law, Republicans set about gathering signatures to force a People’s Veto referendum. They succeeded in collecting more than enough names through a method known as “lying through their Sarah Palin-esque teeth.” Petition circulators told voters the Democrats’ bill would tax haircuts and create death panels.

In reality, it would create haircuts and tax death panels.

The GOP also resorted to the sordid tactic employed nationally against health-care reform: Pretend it’s more complicated than it really is. In a newspaper op-ed, Republican state Representative Jonathan McKane claimed the legislation had been “jammed through the Legislature at lightning speed last June, with no hearing, no work session and no real debate.”

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