Maine Senate Republicans defy Clean Elections referendum, protect offshore tax havens
The Republican-controlled Maine Senate on Wednesday voted along party lines to protect a corporate tax loophole that allows large, multinational corporations to hide millions of dollars in offshore bank accounts, ignoring the clear intent of Question 1, an initiative passed by a large majority of voters in November.
The referendum required the elimination of “low-performing, unaccountable” corporate tax breaks in order to increase funding for the Maine Clean Elections Fund from $2 to $3 million annually. Earlier this year, the legislature’s Taxation Committee identified eliminating the offshore tax loophole as the best way to enact this policy.
“This bill completely rewrites last year’s citizen initiative, as if it never happened,” said Sen. Nate Libby of Lewiston the lead Senate Democrat on the Taxation Committee. “Voters said, overwhelmingly, that they wanted two things: To strengthen our Clean Elections system and to close corporate tax loopholes. By passing this bill, Republicans in the Senate have ignored the will of Maine people. They should be ashamed.”
The version of the law passed by the Senate instead draws funding from Maine’s General Fund, which could otherwise be used for education, health care or other state expenses. According to Maine Revenue Services, the state loses approximately $10 million each year when multinational corporations hide their income in offshore tax havens.
Supporters of Maine’s Clean Election law were in Augusta yesterday to make clear that the issue of funding for Maine’s public campaign financing system goes even deeper than the current debate. They called on lawmakers to pay back $1.7 million that was raided from the Clean Election Fund and used for other purposes in 2015.
“Maine voters have made it clear, they want a strong Clean Election law that allows candidates to run for office without being beholden to wealthy special interests,” said Maine Citizens for Clean Elections Executive Director Andrew Bossie “Now those opportunities are in jeopardy because years of elected officials raiding the fund and using the money for other purposes.”
Over the years, $9.8 million has been raided from the Clean Elections Fund, with only $3.1 million of that amount ever returned. A net amount of more than $6 million is owed to the fund. The most recent raid, which amount to $1.7 million, occurred in 2015, after the recent Clean Elections Initiative (also known as Question 1 on the 2015 ballot) was already on its way to the ballot.
If the $1.7 million is not returned, the Clean Elections Fund could run dry in 2016 or 2018, despite the fact that Maine voters overwhelmingly voted in support of Clean Elections when they passed Question 1 last November with a double digit margin of victory.
“For the Clean Elections Fund to run out of money in this or a future election cycle would be an insult to Maine people, especially after they just overwhelmingly reaffirmed their mandate on Maine’s first-in-the-nation Clean Election Act,” said Polly Ward, Vice-President of the Maine League of Women Voters. “It’s time that lawmakers end the IOU’s and fully fund Maine’s Clean Election Act.”
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