Interview with Christopher St. John (10/6/09), Auto Excise Tax Repeal

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October 6, 2009

Christopher St. John

Christopher St. John is the executive director of Maine Center for Economic Policy (MECEP) and is an opponent of the Maine Auto Excise Tax Repeal, Question 2. Question 2 is scheduled to appear on the November 3, 2009 ballot. See also: St. John on TABOR II.

1. MECEP is an opponent to Question 2 and has even donated to the campaign against the auto excise tax repeal efforts. Why?

Excise taxes are the only other significant form of revenue for municipalities, in addition to property taxes. So it’s simple, if you reduce excise taxes by, whatever it is, $70 or $80 million it will either make it more difficult for municipalities’ maintenance of roads by that amount or it will increase property taxes by that amount. Those are the only choices that municipalities have. For a reduction of excise taxes for a minority of Maine drivers, most of whom drive cars, like me, older than will be benefited by this excise tax reduction, which is only for relatively new cars. So why would anybody vote for an excise reduction to your neighbor who drives a new Lexus in order to cut my road paving or raise my property taxes? That’s not a good deal. And we’re hoping most will recognize that’s not a good idea.

2. One of the main arguments in favor of Question 2 is that it will help promote clean air and fuel efficiency by providing tax breaks for new hybrid or energy efficient vehicles. In your opinion, is there any truth to this?

I drive a 2004 Honda hybrid, no exemption, no reduction under this bill. I’m doing my bid. I get 40 to 50 miles per gallon. On the other hand, if their proposal would permit the purchase of a new, what do they call them, I don’t even know, Cadillac Escalade, a big boat of a thing, that gets 12 or 15 miles to a gallon and call that super efficient under the definitions in their proposal. That’s neither good fiscal policy nor is it good environmental policy. Which is why several environmental organizations have said, this is “green wash.” They're only calling it environmentally friendly in order to attract some positive attention.

3. If Question 2 were to be approved, what does that mean for Maine? What would be the impact, in your opinion?

The excise tax has three virtually certain consequences, I believe all of these things would happen:

  • Increase in property taxes to a degree. The loss of that revenue could not be made up and likely be passed on to property taxes.
  • To another degree, some savings might be forced in road maintenance at the local level, which I don’t think is a good idea.
  • It is likely that the municipalities would come to the state legislature to say, you have to help bail us out. The state legislature has been mindful of property tax increases and has chased after expenditures at the local level trying to increase the amount of state subsidy, in various ways, to the municipalities to at least not increase the burden on property taxes.

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