There’s more than one way to tax a population | Letter

Bill Bridgeo, who was an Augusta city manager and is now state representative for District 60, points out that property taxes are making it difficult for many to get by (“The time for property tax reform in Maine is now,” July 2).

He suggests that primary residences be taxed at a lower rate than some other properties, and that sales tax be used to offset funds from property taxes.

These approaches fit within our current approach to taxes, which follows the ability-to-pay principle. This approach levies taxes based on the value of some entity (e.g., the value of a piece of property, or the income a person receives). An alternative is the benefits received principle, which levies taxes based on the government benefits a person receives.

For example, in this state car excise tax is based on the retail value of a vehicle, and the year it was purchased. This is an example of the ability-to-pay principle. There is no direct relation between road use and taxes paid. A benefits received approach would charge based on the miles driven, and would thus impose a direct relation between road use and taxes.

Applying the benefits received principle to property would lower taxes for those who used few services, and charge more for those who used more services. It may be impossible to change our approach to taxation at this late date, but it is worth noting that the current approach is not the only approach that exists.

William Vaughan Jr.
Chebeague Island

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Tagged: letter to the editor