Election 2009 – Question 2 – Excise tax system called into question

By Kathy McCarty  
Staff Writer
    Question 2 has Maine residents considering whether to reduce the excise tax on certain vehicles or retain the current system of determining the tax.
    Under Question 2, voters are asked: Do you want to cut the rate of municipal excise tax by an average of 55 percent on motor vehicles less than six years old and exempt hybrid and other alternative-energy and highly fuel-efficient motor vehicles from sales tax and three years of excise tax?
    City officials expressed concern, should voters favor passage of the referendum question. Municipalities rely on revenue sharing through the state to maintain roads and infrastructure. If Question 2 goes through, it will shift taxes once collected by the state and passed on to communities through revenue sharing to the local level.
    “If Question 2 passes, the state will receive less funds and therefore have less money to pass along to cities and towns in Maine, through the revenue sharing program. That will leave municipalities having to raise taxes to cover such costs as road maintenance — paving, plowing,” said Presque Isle City Manager Tom Stevens.
    Stevens said the end result would be someone without a car could see their property taxes go up, thus supporting road and bridge work, benefiting those with vehicles.
    “Excise taxes would be reduced for a select few, while taxes would most likely have to be raised for property owners — business and residential — to make up for the state’s loss of revenue,” said Stevens.
    Kirk Carroll, owner of Carroll’s Auto Sales in Presque Isle, said he’d wait and see what decision voters make come Nov. 3.
    “It’s up to consumers. I haven’t heard a lot about this particular referendum question. I haven’t had any feedback at all from customers,” said Carroll.
    Carroll said it would have more of an impact on dealers who are more involved with the sale of hybrid vehicles.
    Ultimately, it will be up to voters to determine whether they’ll benefit by passage of Question 2 or if the end result is more than they’re willing to support.