An Act To Lower Maine Income Tax Rates
Maine Legislature, Session 123, LD 1434
Committee: Taxation
Sponsors: ROBINSON, ROSEN, BROWNE, FLETCHER, HOTHAM, MILLETT, SYKES, TARDY, WEA VER
Amends: 36 MRSA §5111, 36 MRSA §5111-C, 36 MRSA §5403

Legislative Document 
No. 1434 
H.P.1008 
House of Representatives, March 15,2007 
An Act To Lower Maine Income Tax Rates 
Reference to the Committee on Taxation suggested and ordered printed. 
Presented by Representative ROBINSON of Raymond. 
Cosponsored by Senator ROSEN of Hancock and 
17l~/J7.~ 
MILLICENT M. MacFARLAND 
Clerk 
Representatives: BROWNE of Vassalboro, FLETCHER of Winslow, HOTHAM of Dixfield, 
MILLETT of Waterford, SA V AGE of Falmouth, SYKES of Harrison, TARDY of Newport, 
WEA VER of York. 
Printed on recycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 36 MRSA §S111, first ~, as amended by PL 1999, c. 731, Pt. T, § 1, is 
further amended to read: 
A tax is imposed for ea6A taKable year begiRRiRg OR or after JaRuary 1, 2000, on the 
Maine taxable income of every resident individual of this State. The amount of the tax is 
determined as provided in this section, except that the rates provided in this section for 
tax years beginning on or after January 1, 2008 must be adjusted as provided by section 
5111-C. 
Sec. 2. 36 MRSA §S111, sub-§l-B, as enacted by PL 1999, c. 731, Pt. T, §3, is 
amended to read: 
I-B. Single individuals and married persons filing separate returns; tax years 
beginning 2002 but before 2007. For tax years beginning on or after January 1,2002 
but before January 1, 2007, for single individuals and married persons filing separate 
returns: 
If Maine Taxable income is: 
Less than $4,200 
At least $4,200 but less than $8,350 
At least $8,350 but less than $16,700 
$16,700 or more 
The tax is: 
2% of the Maine taxable income 
$84 plus 4.5% of the excess over $4,200 
$271 plus 7% of the excess over $8,350 
$856 plus 8.5% of the excess over 
$16,700 
Sec. 3. 36 MRS A §S111, sub-§l-C is enacted to read: 
I-C. Single individuals and married persons filing separate returns; tax years 
beginning 2007. For tax years beginning on or after January 1, 2007, for single 
individuals and married persons filing separate returns: 
If Maine Taxable income is: 
The tax is: 
Less than $4,750 
2% of the Maine taxable income 
At least $4,750 but less than $9,450 
$95 plus 4.5% of the excess over $4,750 
At least $9,450 but less than $18,950 
$307 plus 6.5% of the excess over $9,450 
$18,950 or more 
$924 plus 8% of the excess over $18,950 
Sec. 4. 36 MRSA §S111, sub-§2-B, as enacted by PL 1999, c. 731, Pt. T, §5, is 
amended to read: 
2-B. Heads of households; tax years beginning 2002 but before 2007. For tax 
years beginning on or after January 1, 2002 but before January 1, 2007, for unmarried 
individuals or legally separated individuals who qualify as heads of households: 
If Maine Taxable income is: 
Less than $6,300 
At least $6,300 but less than $12,500 
At least $12,500 but less than $25,050 
The tax is: 
2% of the Maine taxable income 
$126 plus 4.5% of the excess over $6,300 
$405 plus 7% of the excess over $12,500 
$25,050 or more 
$1,284 plus 8.5% of the excess over 
$25,050 
Sec. 5. 36 MRSA §5111, sub-§2-C is enacted to read: 
2-C. Heads of households; tax years beginning 2007. For tax years beginning on 
or after January 1, 2007, for unmarried individuals or legally separated individuals who 
qualify as heads of households: 
If Maine Taxable income is: 
Less than $7,150 
At least $7,150 but less than $14,200 
At least $14,200 but less than $28,450 
$28,450 or more 
The tax is: 
2% of the Maine taxable income 
$143 plus 4.5% of the excess over $7,150 
$460 plus 6.5% of the excess over 
$14,200 
$1,387 plus 8% of the excess over 
$28,450 
Sec. 6. 36 MRSA §5111, sub-§3-B, as enacted by PL 1999, c. 731, Pt. T, §7, is 
amended to read: 
3-B. Individuals filing married joint return or surviving spouses; tax years 
beginning 2002 but before 2007. For tax years beginning on or after January 1, 2002 
but before January 1, 2007, for individuals filing married joint returns or surviving 
spouses permitted to file ajoint return: 
If Maine Taxable income is: 
Less than $8,400 
At least $8,400 but less than $16,700 
At least $16,700 but less than $33,400 
$33,400 or more 
The tax is: 
2% of the Maine taxable income 
$168 plus 4.5% of the excess over $8,400 
$542 plus 7% of the excess over $16,700 
$1,711 plus 8.5% of the excess over 
$33,400 
Sec. 7. 36 MRSA §5111, sub-§3-C is enacted to read: 
3-C. Individuals filing married joint return or surviving spouses; tax years 
beginning 2007. For tax years beginning on or after January 1, 2007, for individuals 
filing married joint returns or surviving spouses permitted to file a joint return: 
If Maine Taxable income is: 
The tax is: 
Less than $9,500 
2% ofthe Maine taxable income 
At least $9,500 but less than $18,950 
$190 plus 4.5% of the excess over $9,500 
At least $18,950 but less than $37,950 
$615 plus 6.5% of the excess over 
$18,950 
$37,950 or more 
$1,850 plus 8% of the excess over 
$37,950 
Sec. 8. 36 MRSA §5111-C is enacted to read: 
§5111-C. Reductions in individual income tax rates 
1. Hiehest rates reduced. For tax years beginning on or after January 1, 2008, the 
8% tax rate on the top tax brackets contained in section 5111, subsections l-C, 2-C and 
3-C must be adjusted as follows. 
A. For each tax year beginning in 2008 to 2010, the tax rate that was applicable in 
the immediately preceding tax year must be reduced by 1 % until that rate equals 5%. 
B. For each tax year beginning in 2011 or after, the tax rate is 5%. 
2. Second-hiehest rates reduced. For tax years beginning on or after January 1, 
2008, the 6.5% tax rate on the second-highest tax brackets contained in section 5111, 
subsections l-C, 2-C and 3 -C must be adjusted as follows. 
A. For each tax year beginning in 2008 to 2010, the tax rate that was applicable in 
the immediately preceding tax year must be reduced by 0.5% until that rate equals 
5%. 
B. For each tax year beginning in 2011 or after, the tax rate is 5%. 
3. Forms, instructions and tables. The State Tax Assessor shall incorporate the 
changes arising from this section into the forms, instructions, rate schedules and 
withholding tables for the appropriate tax years. 
Sec. 9. 36 MRSA §5403, as repealed and replaced by PL 1999, c. 731, Pt. T, §10 
and affected by § 11, is amended to read: 
§5403. Annual adjustments for inflation 
Beginning in ~ 
2008, and each subsequent calendar year thereafter, on or about 
September 15th, the State Tax Assessor shall multiply the cost-of-living adjustment for 
taxable years beginning in the succeeding calendar year by the dollar amounts of the tax 
rate tables specified in section 5111, subsections 1 S, 2 S aAd 3 S 1-C, 2-C and 3-C. If 
the dollar amounts of each rate bracket, adjusted by application of the cost-of-living 
adjustment, are not multiples of $50, any increase must be rounded to the next lowest 
multiple of $50. If the cost-of-living adjustment for any taxable year is 1.000 or less, no 
adjustment may be made for that taxable year in the dollar bracket amounts of the tax rate 
tables. 
The assessor shall incorporate such changes into the income tax forms, 
instructions and withholding tables for the taxable year. 
Sec. 10. Application. This Act applies to tax years beginning on or after January 
1,2007. 
SUMMARY 
This bill decreases the top 2 income tax rates over a 4-year period, beginning with tax 
year 2007. The initial decrease is from 8.5% and 7% to 8% and 6.5%, respectively, and 
then a further 1 % and 0.5% decrease in each rate, respectively" for the 2008, 2009 and 
2010 tax years until both rates are 5%.