Republican
Legislators draft response to Democrat plan
The area’s Republican legislators responded favorably to the release
by House Democrats of a Small Business Bill of Rights, but countered with
their own plan that they say is more what businesses in Maine need from Augusta. “We
welcome the Democrat leadership’s newfound interest in the success
of small business,” said Rep. Stephen Bowen (R-Rockport), “and
I hope that we really can work with them to make some positive things happen
for Maine businesses for a change.”
Bowen and Rep. Chris Rector (R-Thomaston), co-authors of a draft response
to the Democrat plan, made clear, though, that more is needed to make business
work in Maine than what is proposed in the House Democrat plan. “The
businesses I talk to really only want three simple things from Augusta,” said
Rector. “They want us take less of what they make, listen more to what
they have to say, and, most importantly get out of their way—don’t
try to help, just get out of the way.”
To that end, Bowen and Rector worked with business leaders over the past
couple of weeks to develop a business plan of their own, which they say is
closer to what the state’s businesses really need. They hope to take
the preliminary plan to colleagues in the Legislature and then work in the
next session to fine tune the plan and get it passed.
Draft plan for Maine Businesses
Take less from Maine businesses
Small business success is about more then just taxes and other business
costs, but money is the lifeblood of business growth and survival.
Money a small business keeps can be reinvested to foster growth, can
be spent on new technologies that make a business cleaner and safer,
can be spent providing employees with better pay, benefits, and working
conditions. If the Legislature and State Government spent less time
taking money away from small businesses and more time helping small
businesses be successful, the Maine economy would be better off and
there would be more money all around. With this thinking in mind, we
advocate the following specific changes:
- Phase out the personal property tax on business equipment. This tax
discourages small business investment and forces businesses to incur
high costs for record keeping and compliance.
- Reform the income tax. Maine’s
regressive income tax is regularly identified as an impediment to business
growth. Most small businesses proprietorships, farms, and small corporations
pay business income taxes through the individual income tax and they
pay some of the highest tax rates in the nation and at low income thresholds.
Small businesses need to keep more working capital for investment,
job creation and survival against fierce corporate and international
competition.
- Conform to the Federal tax code for the death tax. Family
business owners and investment dollars are moving out of state because
of Maine’s
failure to comply with federal changes that has made dying in Maine
more expensive than dying elsewhere.
- Restore small business expensing
and depreciation tax conformity. Small business owners are being forced
to comply with two different sets of tax depreciation laws, which costs
extra money in state taxes and compliance, and they are denied extra
income that could be used for investment, employee wages and benefits,
and other increasing business costs. These backdoor tax increases hamper
the small business job creation machine.
- Reform regulations regarding
health insurance, to drive down costs for employers who provide health
coverage or who want to. Similar insurance policies are cheaper in
other states, often a great deal cheaper. Maine needs insurance reform
to cut insurance costs, not a costly new state program, and Maine should
embrace Health Savings Accounts as a way of cutting health care costs
further for employers and workers.
- Undertake a reform effort to reduce
Workers’ Compensation costs.
Workers’ Compensation premiums are a direct tax on jobs and
wages. And Maine’s Workers’ Compensation system still
ranks among the most expensive in the nation.
- Enact lawsuit abuse
reform legislation to protect small business from meritless lawsuits
and to cut liability insurance costs.
Listen more to Maine businesses
Too many people involved in state government have little idea what
it takes to run a small business, and while large employers can
afford costly representation in Augusta and gain easy access to
powerful state officials, small business is often without a voice
or advocate within state government. To give small business a strong
voice in the Capitol, we advocate the following:
The creation of an Office of Business Research and Analysis within
state government, under the jurisdiction of the legislature and on
par with the Office of Fiscal & Program Review (OFPR) and the Office of Policy & Legal
Analysis (OPLA). Such an office will provide non-partisan research
on the impact on small business of proposed legislation and track
the impact of such legislation over time. This office can be created
by redirecting existing resources already available within OPLA
and OFPR.
The creation of an Office of Small Business Ombudsman, independent
of the Executive Branch and tasked with being an advocate for small
businesses in their dealings with state agencies. This office can
also be created within existing resources.
A constitutional amendment requiring that any proposed legislation
which imposes an unfunded mandate on small businesses be approved
by a 2/3 majority of both houses of the legislature, as is the case
now for unfunded mandates on municipalities. The legislature should
ensure that additional state-imposed costs for small businesses have
bipartisan support.
Get out of the way of Maine businesses
Too often, the state makes doing business in Maine harder than it
has to be. Substantial work needs to be done to cut regulatory and
paperwork burdens and in general change the state’s attitude
toward small business. The last things we need, though, are more
state programs to help small businesses. Instead, to make Maine
friendlier toward business, we advocate the following:
- Repeal of recent re-sale certificate. This 2004 tax law imposes high
costs and considerable inconvenience on small business, while
gaining the state virtually nothing.
- Repeal the new Service Provider tax, which,
though not a new tax, requires separate record-keeping and is therefore
yet another burden on those businesses it affects.
- Review of existing
tax and regulatory burdens with an eye to identifying additional examples
of wasteful regulations such as the tax law changes mentioned above.
- Enactment
of a Paperwork Reduction Act that requires state agencies to regularly
submit their paperwork requirements to the Legislature for review and
analysis. The Legislature’s Office of Small Business
Research shall make recommendations for ways paperwork and
other regulatory burdens may be reduced.
- Force state agencies
to coordinate permitting processes so that businesses expansion is
simplified and encouraged rather than discouraged.
- Require the new
Office of Small Business Ombudsman to submit an annual report
grading state agencies on their dealings with small business, based on feedback
collected from such businesses, and reported in report card format
for use by the legislature and the public. Business-hostile state
agencies and employees should be identified and dealt with.
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