Is the tax reform passed by the Legislature constitutional?

A conservative think tank and a Republican senator say the tax reform is unconstitutional because it offers lower income taxes for residents but not to nonresidents who work within the state.

“The tax reform plan violates the Privileges and Immunities Clause because it imposes a higher tax rate on nonresidents than it does on residents,” says Chris Cinquemani, spokesman for the Maine Heritage Policy Center.

The reform, he said, “disadvantages taxpayers who move or return to Maine by preventing them from using the household credit during the first tax year of their residency.”

Sen. David Trahan, R-Waldoboro, says if voters uphold tax reform on June 8, he would sue on the grounds the plan is unconstitutional.

Attorney General Janet Mills says the plan is constitutional.

She wrote to the Legislature’s Taxation Committee in April and cited two court rulings that support her contention.

“The household tax credit is rationally based on the financial burden of a taxpayer’s year-round presence within the state,” Mills wrote.

 

– Ethan Wilensky-Lanford