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Maura Pillsbury is a tax policy analyst at the Maine Center for Economic Policy.
Right now, lawmakers in Maine are making a big decision. They’re looking at a bill (LD 1089) that would create a “millionaire’s tax” — a 4 percent tax on people who make more than $1 million a year. The money from this tax would go straight to Maine’s public schools — from pre-K all the way through 12th grade.
This extra tax would only apply to income above $1 million. So, if someone earns $1.5 million, they would only pay the extra tax on the $500,000 over the first million. People making less than $1 million would not pay this tax at all.
I believe Maine is at a crossroads. We can choose to be a state that invests in families, schools and kids, or we can allow deep cuts to vital services while protecting a tax code that favors the wealthy. One path lifts people up; the other leaves more Mainers behind.
Right now, rich people in Maine pay the same tax rate as teachers, nurses and everyday workers. I don’t think that’s fair. Everyone should pay their fair share.
Let’s look at the facts.
As recent migration trends reveal, Maine is a desirable place to live. Studies show that rich people don’t move away just because of taxes. Like most people, they move because of jobs, family, or lifestyle — and Maine has what many are looking for: natural beauty, vibrant communities and a high quality of life. When we invest in our people and communities, we make our state even more attractive to families and businesses alike.
Other states have shown that asking the ultrawealthy to contribute more works. In Massachusetts, for example, the number of high-income residents has grown since their millionaire’s tax took effect. Eight states have passed similar taxes, and in six of them, the economy grew just as fast — or even faster — than nearby states without the tax. That’s because taxes are a tool for building a strong economy. Spending money on things like roads and schools helps a state grow stronger.
Supporting small businesses means investing in the systems they rely on. The vast majority of Maine small-business owners don’t earn more than $1 million annually — only about 3 percent would be affected by this tax. And when revenues are used to improve roads, schools and public services, small businesses benefit from a better workforce and a stronger local economy.
Ultimately, I see this as a choice about values and priorities. We can either make cuts to programs that help kids, families and older Mainers — or we can ensure the wealthiest pay their fair share.
Rich people will still be rich with or without this tax. But with it, their contributions could make a big difference. It could help pay for child care, teacher raises, school supplies, and more. Raising the resources to support good schools, build strong communities and support our neighbors during times of economic hardship promotes success now and in the future.
To me, this is about fairness. It’s about making sure Maine is a place where everyone has a chance to do well — not just the very rich.
We urge lawmakers to vote yes on LD 1089. Let’s invest in our kids, our schools and our future. Let’s ask those with the most to give a little more — so all of Maine can thrive.