Gov. LePage’s budget is a bad deal for me and other small business owners
I was wearing both my taxpayer hat and my business owner hat when I attended the presentation of Gov. LePage’s budget at Kennebunk Town Hall last week. By the end of the evening, I had concluded that no matter which hat I’m wearing, his budget is more about politics than it is about policy. In short, it is a bad deal for Maine.
The Governor’s budget is largely based on the discredited principles of “trickle-down,” Voodoo Economics that have caused Americans so much financial misery over the last 35 years. It would deliver 50 percent of income tax cuts to the top 10 percent of earners. For example, a household earning $40,000 per year would see a reduction of $145, while someone earning $400,000 would get a break of $10,679. Why is the person who makes 10 times as much money getting a tax break 74 times larger than that of their less-affluent neighbor?
The LePage administration tells us that lowering the income tax rate for high earners will encourage businesses to relocate to Maine and stimulate business owners to invest in their businesses. The idea that owners decide where to locate their businesses based on the state income tax rate is preposterous. If that were the case, there would be a stampede of businesses moving to low- or no-tax states like Kansas and Louisiana, and those states would be booming economic miracles. Instead, those states have found that these policies have brought them to the brink of bankruptcy.
The notion that lowering income tax leads owners to invest is also ridiculous. As a business owner I can tell you that I don’t put money into my business because I’m in a jolly mood. I invest and hire workers for one reason only: to meet demand. What Maine small businesses need is increased demand, and the best way to stimulate demand is to put more money in the pockets of those who will spend it, not those who will sock it away in foreign banks and financial schemes.
So how is the governor going to pay for these income tax cuts? First, he would increase the sales tax, which has the largest impact on lower and middle income Mainers because we must spend most of the money we earn. Second, he wants to eliminate municipal revenue sharing, the tax money that comes back from the state to cities and towns to help keep our property taxes down. Lastly, the governor’s budget pays for these cuts with wishful thinking. It leaves a $300 million hole that it assumes will be paid for by growth of the economy. That’s a big assumption in these volatile economic times, especially given that his ideas about what causes business growth are not reality-based.
Gov. LePage’s budget won’t deliver prosperity to anyone other than the already-prosperous. I would encourage my fellow citizens to contact their legislators and ask them to get a better deal for Maine.
Veneer Service Unlimited, Kennebunk
You might also like
Today is tax day for most Mainers. It’s a time when I reflect on just how skewed towards the wealthy and powerful our state tax system is. Thanks to Governor
This week, once again, Governor LePage has made an embarrassment of himself and this state with remarks that are both casually, and seemingly deliberately, racist. Wading into an ongoing dispute
This week on the Beacon Podcast, Mike and Ben discuss Rep. Bruce Poliquin’s flipping, Gov. LePage’s lying and the media’s reaction to both. Also, an ethics complaint in a Portland