Taxation committee votes to pass Employment Tax Increment Financing legislation

The Joint Standing Committee on Taxation held a work session on Thursday, March 10. The committee unanimously voted “ought-to-pass as amended” on LD 1156, An Act to Reduce Errors in Employment Tax Increment Financing, sponsored by Rep. Amy Arata (R-New Gloucester). The bill, as originally drafted, attempts to simplify the way benefits under the Employment Tax Increment Financing (ETIF) program are calculated. The bill would base the benefits on gross wages of qualified employees rather than on income tax withholding for those employees.

The amendment clarifies the definition of “gross wages” and makes it consistent with the definition used by the Maine Department of Economic and Community Development (DECD). The amendment also drops the language that gives the Maine DECD and the Maine Revenue Services authority to submit legislation next year. It also changes the percentage of the benefit base, which is the total amount of gross wages paid during calendar year by a qualified business to qualified employees, from 4.2% to 4.5%.
 
The Maine State Chamber will continue to monitor this bill. If you have any questions, please contact Linda Caprara, senior government relations specialist, by calling (207) 623-4568, ext. 106, or by emailing [email protected].