An Act To Reduce Income Tax to 4.5% and Remove Low-income Families from Taxation
Maine Legislature, Session 125, LD 0009
Committee: Taxation
Sponsors: COURTNEY, FREDETTE, HAMPER, CUSHING, HASTINGS, LANGLEY, TRAHAN, CHASE, HANLEY, KNIGHT, NELSON, VALENTINO
Amends: 5 MRSA §1518-A

Legislative Document 
No. 9 
S.P. 24 
In Senate, January 5, 2011 
An Act To Reduce Income Tax to 4.5% and Remove Low-income 
Families from Taxation 
Reference to the Committee on Taxation suggested and ordered printed. 
JOSEPH G. CARLETON, JR. 
Secretary of the Senate 
Presented by Senator COURTNEY of York. 
Cosponsored by Representatives: FREDETTE of Newport, HAMPER of Oxford, 
Representative CUSHING of Hampden and 
Senators: HASTINGS of Oxford, LANGLEY of Hancock, TRAHAN of Lincoln, 
Representatives: CHASE of Wells, HANLEY of Gardiner, KNIGHT of Livermore Falls, 
NELSON of Falmouth, VALENTINO of Saco. 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  5 MRSA §1518-A, as enacted by PL 2005, c. 2, Pt. A, §4 and affected by 
§14, is amended to read: 
§1518-A.  Tax Relief Fund for Maine Residents 
1.  Tax Relief Fund for Maine Residents.  There is created the Tax Relief Fund for 
Maine Residents, referred to in this section as "the fund," which must be used to provide 
individual income tax relief to residents of the State.  The fund consists of all resources 
transferred to the fund under this section and section 1536 and other resources made 
available to the fund. 
2.  Nonlapsing fund.  Any unexpended balance in the Tax Relief Fund for Maine 
Residents may fund does not lapse but must be is carried forward to be used pursuant to 
subsection subsections 1 and 4. 
3.  Transfer from revenue growth.  Beginning with fiscal year 2012-13, at the close 
of each fiscal year, the State Controller shall transfer to the fund any General Fund 
revenue received by the State for the fiscal year being closed that exceeds the amount of 
General Fund revenue received by the State for the previous fiscal year, adjusted by the 
growth limitation factor calculated under section 1534, subsection 2. 
4.  Income tax reduction.  Amounts contained in the fund must be used to reduce 
individual income taxes.  If on December 1st of any fiscal year the fund exceeds 
$1,000,000, the State Tax Assessor shall submit legislation to the Legislature by January 
15th of that fiscal year to reduce the income tax burden pursuant to this section.  The 
legislation must ensure that any amounts contained in the fund are used to:  
A.  Reduce individual income tax rates until a top rate of 4.5% is reached; and 
B.  Increase to $30,000 the income threshold below which heads of household and 
married couples filing jointly pay no state income tax. 
SUMMARY 
This bill requires the transfer to the Tax Relief Fund for Maine Residents, beginning 
in fiscal year 2012-13, of any growth in General Fund revenues over the previous fiscal 
year adjusted by the growth limitation factor.  Money in the fund must be used to reduce 
the overall individual income tax burden by reducing the tax rates until the top rate is 
reduced to 4.5% and increasing to $30,000 the income threshold below which families do 
not pay income tax.