MSBA Legislative Update 05-29-09

BIENNIAL BUDGET ENACTED

The Legislature enacted and the Governor signed into law the biennial budget, originally LD 353, now Public Law Chapter 213, effective May 28, 2009. In order to close a significant budget deficit gap, the biennial budget made a number of reductions to benefits and wages for State employees, raised certain license and permit fees, “swept” certain dedicated funds, made additional changes to Maine’s tax apportionment formula known as the “throw-out” rule, reduced the Business Equipment Tax Reimbursement by 10%, made changes to the net operating loss carry-back and carry-forward provisions, and made a number of changes to estate and individual taxes as well. The full text of the new law is available on the legislative website, by clicking on LD 353 and search for the text of Public Law Chapter 213.

TAX REFORM STILL UNDER DISCUSSION

LD 1088, introduced as making significant changes to Maine’s tax code for the purposes of reducing Maine’s income tax brackets, broadening the sales tax base, and exporting the tax burden to non-residents, has received significant deliberations by the Taxation Committee over the past week, and a number of changes have been made. The Committee continues with its deliberations in hopes that it may vote out the bill by Monday, June 1. To date, the proposal is still undergoing changes, and it remains to be seen whether the bill will provide Maine citizens with income tax relief, or whether the changes to the bill will reduce any amounts of relief. The bill promises to be a touch-point of major debate when it reaches the floor of the House and Senate.

UPCOMING ISSUES

For the status of other issues of interest, please review the linked Legislative Database.

LEGISLATIVE DATABASE

An updated Legislative Database is linked to this Weekly Report for your information. It contains any newly introduced bills that we have identified of interest to the MSBA along with updated status listings of previously introduced bills.

Click here for your Legislative Database.

Click here for a text document of this report.

As always, please don’t hesitate to contact us if you have any questions:
Pattie Aho at 207-622-6311 or paho@pierceatwood.com