Maine’s Tax Burden in FY 2008
Last week the U.S. Department of Commerce’s Census Bureau released their State and Local Government Finance data for FY 2008. I’m still in the process of digesting it, but I was able to update this chart which I first referenced in my testimony to the Joint Standing Committee on Taxation back in January. The chart shows total state and local tax collection as a percent of private sector personal income from FY 1951 to FY 2008. Unfortunately, the new data does not bring any good news to Maine’s taxpayers. After reaching the all-time high of 18.5 percent in FY 2006, Maine’s tax burden has plateaued at that level coming in at 18.3 percent in FY 2008.
In contrast, the chart also shows New Hampshire’s tax burden for comparative purposes. New Hampshire’s tax burden is 41 percent less than Maine’s coming in at 10.8 percent in FY 2008. The reason for the much lower tax burden is not only because state and local tax collections are lower ($5.9 billion versus $4.9 billion, respectively), but also because their private sector income is much higher ($31.9 billion versus $44.9 billion, respectively).