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AUGUSTA — Gov. Paul LePage leaned forward and clasped his hands together. He was talking about his budget proposal, which includes a reduction in the individual income tax rate from 7.95 to 5.75 percent, and the corporate income tax rate from 8.93 to 6.75 percent, over time. It is a subject he is passionate about ”“ ultimately, he’d like to eliminate the income tax altogether.

He called his $6.3 billion biennial budget proposal, which includes eliminating municipal revenue sharing, eliminating the estate tax, eliminating military pensions, reducing tax on other pensions, and extending sales tax to include a number of services, a “doable” plan. He wants to hire more drug agents, judges and prosecutors. He plans to put more money into nursing homes and reduce waiting lists for some services. His budget includes eliminating general assistance and other benefits to non”“citizens and he plans to use some money from the Fund for a Healthy Maine to support primary care reimbursements and the like.

Which part of his proposal will likely bring the most trouble?

“All of it,” he predicted.

LePage said he looked at all 50 states, and found that states like Texas, Florida, and Nevada and New Hampshire, among others ”“ those with no income tax, are more prosperous than Maine. His vision is to eliminate the income tax in Maine; he sees this budget as a step toward that end.

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He bristled at the suggestion he is raising taxes, even though the sales tax would be broadened and increased from 5.5 percent to 6.5 percent, starting Jan. 1, 2016, because, he said, when you put all the facets of his proposal together, it results in tax savings for Maine people. According to his office, it would mean a reduction of $321 million by 2019.

LePage talked about his proposed budget Wednesday, in an hour”“long interview with the Journal Tribune and the Ellsworth American, in the Cabinet Room adjacent to his office. He’ll take his proposal on the road for a town hall meeting next week, with a first stop in Westbrook. He touched on education ”“ and said he won’t be in the running for U.S. President.

Would he consider the second seat if a presidential candidate asked?

“I’m too old,” LePage said.

He said he’s hearing that “everyone thinks municipalities will be destroyed” without revenue sharing, that system of sharing taxes with the municipalities devised in the 1970s that was eroded first under the John Baldacci administration and twice under LePage. But he said with an income tax decrease, he’s putting money in resident’s pockets. And he pointed out that his proposal calls for giving municipalities the telecommunications excise tax, along with the ability to charge some nonprofits property tax. He proposes to put additional state resources in the Homestead Exemption for senior citizens and the Property Tax Fairness Credit and other programs to aid homeowners. The budget includes incentives for municipalities that consolidate services.

As an example, he said Alfred, a town of 3,000 in the center of York County, receives $119,351 in revenue sharing, but said his tax proposal, this year, would put $824,949 in residents pockets. And while he said he believes municipalities can find savings in their budgets, he implied that residents ”“ with more money in their pockets because they’re paying less income tax ”“ may decide they’re willing to pay more in property taxes.

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He pointed to Falmouth, which receives $457,000 in revenue sharing but whose residents pay $41 million in income taxes.

“Just maybe, if we give it back to the people, they might give the town a million,” he said.

He’s hoping, by reducing income tax and eliminating estate taxes, to keep more homegrown retirees in Maine for six months and a day ”“ the amount of time required for legal residency ”“ rather than seeing them change their residency to Florida, where there’s no income tax. And he’s hoping to attract more folks ”“ military retirees who are typically in their 40s and 50s and interested in working a second career and contributing to the economy.

As for education, he’s prepared to invest in the university system, but said K”“12 scores haven’t changed in 20 years.

“K to 12 is a mess,” he said. Low-paid teachers often dip into their own pockets for supplies. As well, LePage said, Maine doesn’t use virtual education to the extent it should. He reiterated his stance that Maine has far too many school superintendents as compared to other states with larger numbers of students. He pointed to the success of a program that sends some high school juniors to college to gain as much education as they can while still in high school.

As to his sales tax proposal would see the tax broadened to include items not currently taxed. Service provider sales tax would rise to 6 percent from 5 percent; sales and use taxes from 5.5 to 6.5 percent. Meals tax, now at 8 percent, would decrease to 6.5 percent, and lodging tax would stay the same, at 8 percent.

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He estimated that Florida charges around 18 percent lodging tax.

“I’m just trying to make it fair,” he said.

And his entire proposal?

“This is a massive tax cut,” he said.

LePage is scheduled to speak and answer questions about his budget proposal at 6 p.m. Wednesday, Feb. 11 at Westbrook Performing Arts Center, 471 Stroudwater St. Further sessions in other locales are planned, but not yet scheduled.

— Senior Staff Writer Tammy Wells can be contacted at 324”“4444 (local call in Sanford) or 282”“1535, ext. 327 or [email protected].



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