Maine has become the latest state to impose a tax on its top earners, joining a growing list of blue states that are exploring or adopting new wealth taxes. The state's new 2% surcharge on annual income over $1 million brings the total tax rate to 9.15%, and is expected to raise around $150 million over two years.
The tax is part of a broader trend of states seeking to raise revenue through new income-tax levies on top earners. Washington state's governor recently signed a similar millionaires tax into law, while Massachusetts voters approved a 4% surtax on annual income over $1 million in 2022.
The revenue from these levies is badly needed to fund state services in the wake of federal cuts to healthcare and food assistance. Democrats and progressive groups are prioritizing hikes on top earners ahead of elections this fall in Rhode Island and Colorado.
While some wealthy Mainers oppose the tax, others support it, including millionaire entrepreneur John Coleman and author Stephen King. Coleman argued that government funding is crucial to building the kind of infrastructure and schools that attract talented people to the state and keep the economy growing.
