Maine has gained more taxpayers and income than it has lost going back to the early 1990s, according to IRS tax records. In other words, for every Maine taxpayer who has moved out of state, a greater number of taxpayers have moved here to replace those who have left.
On net from 1993 to 2010, Maine added 903 taxpayers, more than 28,000 adults and children in taxpaying families, and about $1.8 billion in adjusted gross income. The IRS data can be easily viewed and manipulated at the Tax Foundation’s website.
Unfortunately, when it comes to migration in and out of Maine, a long line of pundits and politicians ignore these basic facts and rely instead on selective anecdotes to jump to conclusions that do not square with reality. Former state senator and commentator Phil Harriman is the latest example.
Harriman appeared on WCSH news in support of Governor LePage’s plan to eliminate the income tax, because he says the plan would help stop Mainers from packing up and moving to other states to avoid paying Maine’s income tax:
“What’s beneath all this is numerous Maine citizens who have changed their residency, and taken their income, their capital, their excise taxes…to other jurisdictions.”
Harriman seems oblivious to the fact that Maine has actually gained, not lost, taxpayers and income through migration. This is an inconvenient truth that doesn’t support the Governor’s assault on Maine’s income tax. Even more inconvenient for anti-income-tax advocates and policymakers who like to hold up New Hampshire as a model, the same IRS tax records show that more taxpayers and income have moved from New Hampshire to Maine than the other way around.
People who move across state lines do so overwhelmingly for job or family reasons, not because of taxes. A large body of evidence and careful research supports this. Michael Mazerov summarizes:
“Only about 1.5 to 2 percent of U.S. residents relocate across state lines each year, and the rate seems to be declining. And of that 1.5 to 2 percent who make an interstate move, the vast majority cite new, transferred, or lost jobs or family-related reasons (like needing to care for an ailing relative) — not the “other” category that would encompass lower taxes.”
If jobs are key to migration, then Governor LePage’s plan to eliminate the income tax is a step in the wrong direction. Kansas recently eliminated its income tax and has experienced lower rates of job growth than neighboring states. Kansas has also had to cut funding for education and other critical services to pay for the plan which provides the most benefits to the state’s wealthiest residents and shifts costs to everyone else.
We shouldn’t raise taxes on the poor and cut them for the rich—exactly what the Governor’s plan would do— just because folks like Phil Harriman and Governor LePage happen to know a few people who moved out of state and overlook the fact that just as many people have moved here and now call Maine home.
