Despite recent controversy surrounding its House Chair, the Joint Standing Committee on Taxation is forging ahead. The Maine Republican Party erupted in outrage last month after learning that Rep. Ryan Tipping, D-Orono, was co-chairing the committee after failing to accurately disclose $9,000 in payments he received from the Citizens Who Support Maine’s Public Schools PAC for supporting Question 2.
Tipping received these funds while serving on the Education Committee last session, but was then chosen by Democratic leadership to chair the Taxation Committee in the 128th Legislature. Now, after accepting these funds as a Clean Elections candidate and failing to legally disclose the payments he received (as outlined by the ethics commission), Tipping continues to serve as co-chair of the committee charged with enforcing changes to Maine’s tax code that come as a result of Question 2’s passage last November.
Not only is it suspicious that a legislator serving on an education committee was paid by a ballot question committee for supporting an upcoming education referendum, appointing this same legislator as head of the committee tasked with upholding the referendum is even more suspect.
For Maine Democrats, this is just ‘business as usual’ in Augusta.
But now, Tipping and his committee colleagues are slated to hold public hearing on Monday, March 20 regarding LD 571, a bill that would eliminate the three percent surtax imposed by Question 2 and find an alternative source of funding to ensure the state of Maine is respecting its obligation to fund 55 percent of public education costs.
The bill, sponsored by Sen. Dana Dow, R-Lincoln, calls for the elimination of the three percent surtax imposed on individual incomes over $200,000 and exploration of other revenue sources like recreational marijuana taxes, Amazon and Airbnb, that could make up for this disparity.
Question 2 imposed a three percent surtax on incomes earned over $200,000 to fund k-12 public education in Maine, growing Maine’s top income tax rate from 7.15 to 10.15 percent. For individual earners between $200,000 and $1 million, Maine’s rate is the highest in the country.
“This new income tax rate makes our state uncompetitive, both on a regional and national scale,” Sen. Dow said in a press release. “As a result, we’ve already started to see businesses, health care professionals and other affected citizens leave our state, taking jobs and resources with them, because they can’t afford to operate here under these conditions.”
Dow is referring to roughly 11,450 Mainers who file their taxes as pass-through entities, meaning business profits are passed onto the business owner as individual income. These filers are many of the family-owned farms and small businesses that drive Maine’s economy.
It remains unclear how Tipping could co-chair proceedings with impartiality for any bill proposed during the 128th Legislature that would modify Question 2 as originally written and passed by Maine voters.
This is especially true for LD 571. Considering Tipping won’t recuse himself and still has the support of Democratic leadership, the controversy surrounding his unethical conduct will likely continue throughout the remainder of this legislative session.
