An Act to Support Maine Businesses Through a Child CareJTax Credit and a Pass-through Entity Tax
Maine Legislature, Session 131, LD 1891
Committee Amendment CA_A_H917 (House)

COMMITTEE AMENDMENT "^-\ " to H.P, 1212, L.D. 1891, "An Act to Support
Maine Businesses Through a Child CareJTax Credit and a Pass-through Entity Tax"
Amend the bill by striking out the title and substituting the followmg:
'Resolve, to Require the Office of Tax Policy to Study the Adoption of a Pass-through
Entity Income Tax'
Amend the bill by striking out everything after the title and inserting the following:
'See. 1. Department of Administrative and Financial Services, Bureau of
Revenue Services, Office of Tax Policy to examine and evaluate system of
taxation of business income and possible adoption of pass-through entity
income tax. Resolved: That the Department of Administrative and Financial Services,
Bureau of Revenue Services, Office of Tax Policy shall examine and evaluate the State's
current system of taxation of business income, including the current system of taxing
pass-through business income at the partner or shareholder level, and the possible adoption
of a pass-through entity income tax to tax such pass-through income, including the
possibility of moving the taxation of that income, or some portion of that income, from the
partner or shareholder level to the business entity that generated the income. The shidy
must mclude examination of the impact of the adoption of a pass-through entity income tax
on a mandatory and an elective basis, on a permanent and time-limited basis and on a
retroactive basis. The Office of Tax Policy shall also include m the study consideration of
the impact of the federal state and local tax deduction limitation on individual taxpayers in
the State, and the manner and fiscal impact of how a pass-through entity income tax has
been enacted and implemented in other states to, in part, address the state and local tax
deduction. The Office of Tax Policy may consult with national income tax experts as
appropriate. No later than January 15,2025, the Office of Tax Policy shall submit a report
based on the study to the joint standing committee of the Legislature having jurisdiction
over taxation matters that includes its fmdings and recommendations, including suggested
legislation, The joint standing committee may submit legislation related to the report to
the 132nd Legislature h 2025.'
COMMITTEE AMENDMENT
ROS
COMMITTEE AMENDMENT"^." to H.P. 1212, L.D. 1891
"^"toH.P. 1212, L.D.
Amend the bill by relettering or renumbering any nonconsecutive Part letter or section
number to read consecutively.
SUMMARY
This amendment replaces the bill with a resolve requiring the Department of
Administrative and Financial Services, Bureau of Revenue Services, Office of Tax Policy
to examine and evaluate the State's current system of taxation of business income at the
partner or shareholder level and the possible adoption of a mandatory or elective pass-
through entity income tax to tax such pass-through income, including the possibility of
moving the taxation of that mcome, or some portion of that income, from the partner or
shareholder level to the business entity that generated the income. The Office of Tax Policy
is required to report to the joint standing committee of the Legislature having jurisdiction
over taxation matters by January 15, 2025, and the committee is authorized to report out
legislation related to the report to the 132nd Legislature in 2025.
FISCAL NOTE REQUIRED
(See attached)
Page2-131LR2189(02)
COMMITTEE AMENDMENT
Approved; 03/11/24 /-^?ci-
LD 1891 LR 2189(02)
An Act to Support Maine Businesses Through a Child Care Tax Credit and a Pass-through Entity
Tax
Fiscal Note for Bill as Amended by Committee Amendment "y
Committee: Taxation
Fiscal Note Required: Yes
Fiscal Note
Minor cost increase - General Fund
Fiscal Detail and Notes
Additional costs to the Department of Administrative and Financial Services, Bureau of Revenue Services to
complete a study and report on possible adoption of a pass-through entity tax are expected to be minor and can be
absorbed within existing budgeted resources,
LR2189(02) - Fiscal Note - Page 1 of 1