Rationale:

Why lower income taxes?  Do we need to jumpstart Maine's economy with tax cuts?  Yes, we do.

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The difference between Jim and other candidates is that the Libby campaign will provide honesty and transparency. Claims by other candidates need to be substantiated. As you can see in the graph above, according to the Federal Reserve, real household income in Maine has been declining since 2021. Observers should ask why that would be, given that "household median income" is relatively stable? The answer the word "real." Real median household income demonstrates that the effect of inflation is cumulative. Real median household income accounts for inflation, whereas simple median household income does not.  Don't listen to those who do not take inflation into consideration. It is easy to manipulate statistical drivers. Inflation squeezes family and small business budgets. Just because the rate of increase of inflation is down from the 9% peak, overall inflation is still rising, and the Federal Reserve is currently expanding the money supply, which dilutes the value of the dollar.

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Add declining real income together with falling corporate income tax collections in Maine, and you'll begin to see a pattern.  According to the Maine Department of Administrative and Financial Services, "corporate income tax receipts were $29.2 million (27.7 percent) under budget in April of 2025 and $65.0 million under budget for the fiscal year (16.7 percent)." Refunds were also over budget (negative variance) for the month by $7.4 million, again according to the Department.

 

An income tax reduction would immediately help stabilize real household income, and it would also relieve the pressure that Maine government has caused due to state policy-driven escalations in energy costs.

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Maine is a state with many types of taxes. While Maine's progressive income tax is higher than most other states in the nation, MaineBiz reported in 2024 that Maine was 4th highest in total taxes in the United States, and is #1 for property tax burden.  The combination of Maine's income and property taxes are the strongest variables affecting Mainers, and that is why Maine citizens need immediate relief in both areas.

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The easiest and best means to lower the property tax in Maine is through raising the already existing Maine Homestead Exemption.  Currently, the program exempts $25,000 from your property taxes, as long as you have lived in the home for the past 12 months.  According to the Portland Press Herald, the median assessed home value rising to $390,000, an all-time record.  The median home price has risen from $225,000 in 2019 to $390,000 today, but the Homestead exemption has not been increased by the state government. In other words, you are a victim of home value inflation.  It's not some myth that people are being driven from their homes under the current Governor's term in office. It's a fact.

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Tax reductions increase disposable income, and will increase economic activity and economic development.  The combination of increasing the Homestead exemption and decreasing Maine income taxes will have an immediate effect.  The reduction in the Maine budget from the income tax reduction of 20% will be approximately a half billion (dollars in the first two year budget).  The reduction in the budget from increasing all Homestead provisions above is approximately $400 million. When adding the repeal of the new tax on senior pensions, the budget cut equates to just over one billion dollars.  This budget cut will be achieved by reducing state jobs through reduction of waste, as well as productivity gains through AI training. An improved amount of taxable transactions will occur when tax cuts are delivered to the economy.  In addition, tax payment delinquencies will be reduced.  Most importantly, the changes will be continued into the second biennial budget, so that Mainers can consistently plan their own expenditures.  That will achieve one billion in total income tax relief.​​

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