For Immediate Release: May 11, 2011
Contact: Jodi Quintero [Berry, Flemings], 287-1488

AUGUSTA – House Democrats supported legislation Tuesday to provide tax credits for more working Maine people. The bill was defeated mostly along party lines in a 76-72 vote, with only two Republican House members supporting the measure.

The bill would have increased the state’s Earned Income Tax Credit to 10 percent of the federal amount, and would have made half of that amount refundable to the taxpayer.

Currently, Maine’s credit is only 5 percent of the federal rate and is not refundable.

The bill’s sponsor, Rep. Elsie Flemings, D-Bar Harbor, said that she amended the original proposal to scale back the increase and cost, and found funding to pay for her plan.

“The Earned Income Tax Credit is a proven tool that helps people enter the workforce and strive to earn more,” said Flemings. “It reduces poverty – especially child poverty – and that grows the economy.”

Supporters said the credit helps low-income families and encourages Mainers to work. According to Maine Revenue Services, the lowest income earners in Maine pay the highest percentage of their income in overall taxes.

No one testified against the bill at the public hearing or spoke against it on the House floor. Democratic members of the Taxation Committee expressed their surprise at the lack of support from Republican members of the House, citing former President Reagan.

“President Reagan called the Earned Income Tax Credit ‘the best anti-poverty, the best pro-family, the best job creation measure to come out of Congress,’” said Rep. Seth Berry, D-Bowdoinham, the lead Democrat on the Taxation Committee. “There is no reason to not support this measure.”

There are a number of tax related bills left to be voted on before the Legislature adjourns in June.

“Soon, the House will be asked to vote in favor of countless Republican bills to benefit wealthier people and corporations,” Berry said. “Why would we not want to benefit working Mainers and small businesses, which bear the greatest burden?”

The bill now faces votes in the Senate, which could come as early as this week.

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