Tuesday, July 7, 2009

Preview your new income tax resulting from new law

The weather forecasts sounds like we could see some showers, possibly a thunder shower or two before this day is over. I guess there’s an even better chance for tomorrow being wet and lousy. But not to worry; we should be back into rather nice weather again Thursday.

As we all know, the last Legislature enacted a change in our income tax collection system and increased sales tax to cover just about everything. It also raised the food and lodging tax. We were told the new law would make tax collections in Maine “Revenue Neutral” compared to past years but would give a fairer tax collection.

No longer will we be able to make deductions on our Maine tax. Rather a complex credits system will be put into place. As your income increases, the credits decrease and at some point no credits can be subtracted from the tax.

I have spoken against this tax as I believe it will make many, if not most, Mainers end up paying more to the state than they now do. The lawmakers say that isn’t true. They say most Mainers will pay less in income tax and that will offset any increases in sales tax. My question: If the new law make revenue neutral, why do we need it? The Democrats have never passed anything that would not give them more money to spend.

As a way to help each of us decide, the Maine Revenue Service has put a simplified tax calculator in its web site for anyone to download. It is in Microsoft Excel format. There are also complete instructions available along with changes in the law and changes in the method of tax calculation. These accompanying documents are also available for download in .PDF format.

I tried it. Using the numbers from my 2008 tax filing, the latest, as they say, available, the spreadsheet told me I’d be getting an income tax reduction of about $75.00. So the lawmakers were correct on that part as it pertains to me. But that calculator includes an estimated increase in sales tax as a result of the changes. It thought I’d be spending about $130.00 more in sales tax. Not much of an increase, but it is indeed an increase.

Why don’t you give it a try and see how it will affect you? Remember, each of us has a different set of circumstances.

The Maine Republican Party is attempting to gather sufficient signatures to force a November ballot question to repeal the new law. If, when, I see one of those petitions, I’ll gladly sign it.

I'm not sure just what Gator Golden was sniffing in our driveway the other day. She could have been figuring out just what had recently passed that spot, or she could have been looking for the scent of her "mommy." However, to find Gator Wife, all she had to do was turn around. GW was trimming bushes just down the driveway.

A couple former Sea Dogs are in the news. Jed Lowrie has returned to Portland as part of his rehab assignment. He played for the Sea Dogs in 2007 and is now on the Red Sox temporary disabled list recovering from an injury. Although he had his first game yesterday in an out of town game, he is expected to be at shortstop at Hadlock Field in Portland tonight. Tickets might be hard to find.

The other is Aaron Bates who began this season in Portland. He was promoted to Pawtucket a few weeks ago and called up to the parent Red Sox where he started last night.

The time is now approaching for me to get ready for my Tuesday senior fitness session. We’ve have some really nice weather recently and that low pressure system now moving through the region shouldn’t slow down my attempts at a good, successful exercise routine.


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