Excise tax cut appears headed to referendum
More evidence of Maine lawmakers’ anti-business attitude.
Without argument, the biggest deterrent to new car sales in the state of Maine is the oppressive excise tax. Most states have either no fee, or a one-time smaller fee. Not Maine. Our lawmakers have never met a tax they didn’t like, and their unwillingness to vote on this issue once again proves it.
Yes, it’s a tough issue, but isn’t that why we elect our citizen-peers to represent us in Augusta? If they don’t want to take up the tough issues, let’s just send them all home, shut down the State House, save the taxpayers millions, and have a big ol’ referendum every November.
How does this tax effect you? Let’s say, for example, you find a really great deal on a new truck, and the dealer is anxious to make a deal, and goes crazy on your trade-in, offering you way more than book value, just to earn your business. Here’s how the numbers might look:
| MSRP or “sticker” price: | $37,600 |
| Dealer discount: | 3,800 |
| Manufacturer rebate: | 5,000 |
| Trade-in Allowance | 15,000 |
| Your net price: | $13,800 |
Before you can congratulate yourself for striking such a great deal, you look at the taxes you’ll pay.
Sales tax: 5% sales tax is based on the price after the trade – this is only fair, since you’ve already paid tax on your trade-in when you bought it – but before the rebates, since rebates are considered the same as cash down payments. So your sales tax amounts to $940…ouch. Well, at least the excise tax won’t be so bad, right? Wrong.
Excise tax: The good news is the excise tax rate is about half of the sales tax – .0225-.025, depending upon where you live in Maine. The bad news is it’s calculated from the top figure, the sticker price of the car! $37,600 x .025 = $940…the same as your 5% SALES TAX!!! As if that were not bad enough, Maine adds insult to injury by whacking you again, year-after-year, each time you renew your registration. Oh but it drops every year for five or six years, which, I guess, is supposed to make us feel good about it.
We tend to get complacent when paying taxes – “you can’t fight city hall” – but when you look at what our neighboring states pay, it’s no wonder Maine is considered the second highest taxed state in the nation.
It’s estimated that towns would lose around $80 million dollars a year if the excise tax were cut in half. In theory, this revenue would have to be replaced somewhere, but why not make the tax fair then figure out how to live within your budget, instead of the current system which views every taxpayer dollar as an excuse to spend.
Source: Portland Press Herald
April 10th, 2009 at 9:35 am
It’s all bull. The towns received millions ($278+ million since 2004, to be exact) for property tax relief. Did we get any property tax relief? We have to take matters into our own hands. Specifically, go to http://www.MoreGreenNow.com and http://www.TaborNow.com, and sign up for e-mail alerts. Make whatever donation you can afford today and as often as possible (I’m up to $100). Then show up on Tues. November 3 and vote YES on both initiatives. Passage of MORE GREEN NOW and TABOR NOW is the only guarantee we have. We must take action to protect ourselves. The time for apathy is over!
April 10th, 2009 at 9:47 am
I’m with you 110% eLaine, but I’m afraid we are a minority in Maine (remember TABOR?). That’s not an excuse for inaction, just an observation.