An ambitious tax reform law is jeopardy of being vetoed at the polls June 8, even though it is designed to reduce taxes for most Mainers and improve the state’s economic prospects.

We can’t support a “Yes” vote on Question 1, and encourage voters to weigh the issue carefully before supporting this veto. Tax reform won’t help everyone, but if each household and business could take the time to calculate its own self-interest, this version of tax reform would become more popular.

Some opponents label LD 1495 as simply a scheme to collect more taxes. But even though it broadens Maine’s sales tax, it does not seek to bring in more revenue ”“ at least from Mainers. In fact, by increasing the proportion of tax revenue provided by out-of-staters, it promises a net reduction in taxes for 88 percent of residents.

Maine’s relatively high income tax rates are a burden for many, and it is widely believed that they scare off companies that would otherwise do business here. The legislation is a carefully crafted effort to solve these problems

Undecided voters should consider the law’s goals:

”“ To encourage economic development by lowering Maine’s relatively high tax rates on income and capital gains.

”“ To make Maine’s narrow sales tax a broader and more stable source of income.

”“ To reduce the tax burden on Maine people by increasing the relatively light taxation the state now imposes on tourists and other non-residents.

The law cuts Maine’s top rate of 8.5 percent. By establishing a flat tax rate of 6.5 percent it is intended to please high earners; yet Maine’s income tax remains progressive through a series of tax credits and a surcharge on incomes above $250,000. Maine Revenue Services has an online calculator to help individuals determine how the law would affect them.

Despite opposition by many Republicans, the tax reform law has won wide support from business groups, including the Maine State Chamber of Commerce. For anyone who has lamented the economic consequences of Maine’s high income and capital gains taxes, this legislation provides an answer.

However, not everyone will come out ahead. Restaurants, hotels and taxicab companies will have to pass along higher taxes, and many businesses are due to begin collecting a 5 percent sales tax for the first time. This selective list, which ranges from dry cleaners and auto repair shops to hired clowns and jugglers, is one of the best arguments in favor of a veto. Stockbrokers, lawyers and barbers, among others, are not on it.

Tax reform has been a hard sell. If it becomes necessary to try again, we’d like to see legislators spread the net sales tax net more broadly, rather than targeting only certain businesses to bear this new burden.

— Comments? Contact Managing Editor Nick Cowenhoven by calling 282-1535, Ext. 327, or via e-mail at nickc@journaltribune.com.