“Is it really a surplus if we’re not paying for these really essential needs that Mainers have?” asked Maura Pillsbury, a state and local tax analyst with the Maine Center for Economic Policy.
The state has had record surpluses since the onset of the pandemic, due to federal COVID relief and increased tax revenues because of higher prices. This allowed Gov. Janet Mills and the Democratic-controlled Maine State Legislature to issue relief checks to residents last year and again last month to help with rising costs for consumer goods and energy.
Now, Republicans and some Democrats are seeking ways to permanently reduce the state’s income by changing the tax code with several bills submitted this legislative session to cut income taxes.
“We really don’t know what’s coming down the pike and a lot of challenges in both urban and rural areas will take significant new funding to address, including the opioid crisis and housing shortage,” Pillsbury said. “Cutting taxes could compromise our capacity to uphold our commitments to Maine people now and in the future.”