Speaker wants to raise income tax despite evidence program can be created without raising taxes
AUGUSTA – Following is a statement from Maine GOP Chair Dr. Demi Kouzounas regarding Maine House Speaker Sara Gideon’s push to raise Maine’s income tax to fund a paid family leave program:
“Today we heard Speaker Gideon, while presenting her mandatory proposal at public hearing, suggest a new increase on top of the income tax increase she is proposing on Maine’s workers. This would essentially raise the income tax from 10 to 14 percent on our workers, who are already taxed at some of the highest rates in the nation,” said Maine GOP Chair Dr. Demi Kouzounas.
“That means the program proposed by Speaker Gideon already is going to cost more than she originally said, and it happened before the public hearing was even completed. Maine’s workers can’t afford to see their income taxes go up – no matter how well-intentioned Speaker Gideon’s plan is.”
“The idea of making sure Maine workers can have paid time off when they need to take care of a family member is admirable and we should all share in that goal,” said Chair Kouzounas. “But this proposal would make the paychecks of Maine’s workers smaller to achieve that goal and we will not support that.”
“Other states are looking at achieving paid family leave through multi-state partnerships and voluntary programs without raising taxes on their workers,” continued Chair Kouzounas. “We should explore those options and seek bipartisan agreement on a plan that helps everyone.”
“Maine can expand paid family leave while protecting both workers and their employers. Let’s create a win-win for Maine’s workers and employers with a smart compromise, instead of a tax increase on workers who might never see any benefit for their hard-earned tax dollars.”
Background:
– Speaker Sara Gideon’s bill originally would have made paid family leave mandatory for Maine employers while adding just over half a percentage point in income taxes on Maine workers, but today during the public hearing for the bill, Speaker Gideon recommended that tax be increased to .75 percent on top of what workers already pay.
– This would effectively increase the income tax for Maine workers by 10% to 14% by adding close to 1 percent to their income tax, which is already one of the highest in the nation.
– Governor Janet Mills made a promise to Maine voters not to increase taxes.
– Maine employers receive up to a 25% federal tax credit for voluntarily providing paid family leave under Section 45S of the federal tax code. If Speaker Gideon’s bill were to become law, they might no longer be eligible for that tax credit.
