Policy Brief: Why Maine lawmakers should reject the Local Option Sales Tax


Communities in every corner of the state have suffered from underfunding of education and local services. The symptoms of cuts to communities are greater pressure on town budgets, cuts to local services and schools, and property tax increases.

Some communities have responded by pushing the state Legislature to authorize “Local Option Sales Taxes,” which would allow municipalities to increase sales taxes within their boundaries. In most proposals, the revenue created by the increase would flow directly to that municipality, rather than to the state.

A Local Option Sales Tax could raise significant revenue for some service centers and for communities heavily reliant on the tourism industry. However, its implementation in those communities would disproportionately affect lower-income Mainers. It would deepen economic inequality by tipping our already lopsided tax code even further out of balance.

Insufficient funding for communities is a statewide problem. It deserves a statewide solution. The Local Option Sales Tax is not the answer.

A comprehensive plan to raise revenue at the state level so we can fund local schools and services is a fairer and more comprehensive solution to the challenges faced by Maine communities.

Click here to read the full policy brief.