The Distributional Effects Of Recent Changes To Maine’S Tax System, Joel Johnson

Maine Policy Review

Both classical economic theory and recent empirical research support the notion that taxes should be progressive: that the wealthiest citizens should pay a larger share of their income in taxes than the middle class, and the middle class should pay a larger share of their income in taxes than the poor. Like every other state in the U.S., Maine’s state and local tax system is not progressive, or even proportional with respect to income, but regressive. This article summarizes recent changes to income, sales, and property taxes that have made Maine’s state and local tax system more regressive.

State Earned Income Tax Credits And “Making Work Pay”: How Maine Might Help Workers, Glenn Beamer

Maine Policy Review

Established in 1975, the Earned Income Tax Credit (EITC) became the federal government’s largest antipoverty program for citizens under the age of 65 by the mid-1990s. In this article, Glenn Beamer gives a brief overview of how the program works and how states have piggybacked on the federal EITC to further assist their working poor. He observes that Maine’s EITC policy does not fully avail itself of potential returns and points to other states with policies that provide greater benefits for the working poor. He suggests that expanding Maine’s EITC not only would provide working Mainers with extra income, but …

Tax Policy And The Principles Underlying A “Good Tax”, Kenneth L. Nichols

Maine Policy Review

A “good tax”—can there be such a thing? Kenneth Nichols explores the principles for evaluating the strengths and weaknesses of taxes on income, consumption, and wealth. Contrary to common argument, Nichols points out, there is no “best” tax, but there are five interrelated criteria for evaluating taxes that, collectively, may be used to assess whether tax reform efforts are moving us closer to or further away from a better overall tax system for Maine.

Tax Policy And Economic Development: A Roundtable Assessment, Christopher St. John, Alan P. Brigham, Charles Colgan, Brian H. Mahany

Maine Policy Review

Economic development continues to be a top policy issue for the state of Maine. Within the broad topic of economic development is the issue of tax policy, and the state continues to experiment with changes in traditional taxes, such as sales and income, as well as with newer approaches, such as Employment Tax Increment Financing. What works and what does not work? Can the state afford the potential loss of revenues associated with tax incentives? Who wins and who loses from these policies? To answer these questions, Maine Policy Review convened a panel of experts to review Maine’s record. Two …