Maine Improves

Maine is a very nice place to summer. It also just got a bit more reasonable for entrepreneurs, small businesses and their employees year round.

As the Wall Street Journal editorial page just noted:

This month the Democratic legislature and Governor John Baldacci broke with Obamanomics and enacted a sweeping tax reform that is almost, but not quite, a flat tax. The new law junks the state's graduated income tax structure with a top rate of 8.5% and replaces it with a simple 6.5% flat rate tax on almost everyone. Those with earnings above $250,000 will pay a surtax rate of 0.35%, for a 6.85% rate. … To offset the lower rates and a larger family deduction, the plan cuts the state budget by some $300 million to $5.8 billion, closes tax loopholes and expands the 5% state sales tax to services that have been exempt, such as ski lift tickets.

The Journal also noted that Maine had the third worst business climate among the states according to SBE Council’s “Small Business Survival Index.” This measure definitely will improve Maine’s ranking on the Index, which ranks states according to their public public policy environments. While the state still has a very long way to go to become a magnet for small business and capital, this is a start.

Raymond J. Keating
Chief Economist
Small Business & Entrepreneurship Council