LePage: Tax reform get us on the road to recovery


By Governor Paul LePage

Weekly Radio Address

October 13, 2012

Millions of Americans were jobless and business bankruptcies reached their highest level since the Great Depression; incomes dropped and unemployment benefits were exhausted. Fifty years ago our economy was in trouble and President John F. Kennedy was candid with his words. He said the “state of our economy is disturbing.”

This look back to 1961 mirrors the hardships Americans face today. Our recovery has been anemic and incomplete, millions of Americans are without jobs, and the U.S. has out-of-control debt which is creating uncertainty for the future state of our economy.

There is a glimmer of hope, however, coming from the states. Like Congress, governors face challenges—but instead of ignoring problems, states are taking action. Reform-minded governors have championed tax reforms, reined in spending and downsized government. At the same time, governors are supporting policies that attract business investment and cut through government red tape.

Tax reform is one way to get us on the road to real recovery. The Tax Foundation released recently its 2013 State Business Tax Climate Index comparing tax rates and policies across states. Maine saw the greatest improvement in its tax ranking this year, moving from 37th to 30th.

This is a positive move for the people of Maine. Last year, my Administration repealed our individual alternative minimum tax, and we eliminated net operating losses for businesses. Those measures alone will save $15 million annually.

In 2013 additional changes to Maine’s tax structure, including lower brackets for individual income taxes will take effect. This reform was not considered in this year’s report and will likely result in even further improvements in Maine’s ranking. Estimates indicate approximately 440,000 Maine resident returns will have an average reduction in their individual income tax liability of $340 in tax year 2013, an average decrease of 11 percent.

A family of four, according to Maine Revenue Service, with $50,000 of Maine Adjusted Gross Income will have a reduction of $300 or a 25 percent cut. Furthermore, approximately 70,000 working Maine people at the lowest income levels will have their state income taxes eliminated completely. Yet another sign of hope.

Taxes are a job-killer. When businesses are squeezed by taxes Mainers lose. We lose opportunities to attract new jobs and earn better wages. This is why many governors are focusing on tax reform. The Cato Institute recently ranked all governors based on their fiscal policy. Four states, including Maine, received an A. Governors who cut taxes and spending received the highest grades while lower marks went to states which expanded government with tax-and-spend policies.

If there is one lesson we have learned during the past four years it is that we cannot tax and spend our way out of economic troubles. No amount of stimulus money will dig us out of this hole. The only way we can get ahead again is to understand our fiscal limitations and prioritize our needs from wants. What we may want is not necessarily what we need or can afford.

While some rely on hope to evoke change, change does not come without hard work. This brings me back to one of my favorite quotes from President Kennedy: “And so, my fellow Americans: ask not what your country can do for you; ask what you can do for your country.”

It’s time we revive the American Dream and rebuild our way of life. I believe that we were once truly the Land of the Free and with hard work we can find that freedom again.


  1. Hi!
    But, but, but…………..Gov. LePage wants to tax the internet which is not good for businesses and the people.
    What is he thinking?
    Thank you!
    Lise from Maine


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