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Update: New Tax on Cosmetic Medical Procedures Removed From Maine’s Budget Proposals

With the hope of avoiding a looming government shutdown, the Maine legislature finally came to an agreement on a new two-year, $6.7 billion budget and had transmitted it to Governor Paul LePage who vetoed multiple spending items only to have them overturned by the state House and Senate.

On June 15, two competing budget proposals were formally reported out of the Joint Committee on Appropriations and Financial Affairs after months of deliberation and negotiation. Thanks in part to an ASPS-led coalition of 13 medical organizations, neither of these reports contained language which would expand the state's sales tax to include taxes on cosmetic medical procedures.

On June 16, the legislature approved a budget filled with compromises that were drawn up by top legislative leaders behind closed doors. LePage initially included the onerous cosmetic tax when he released his budget proposal at the beginning of the year and again when he submitted his proposed change package earlier in May.

This agreement did not come easy. The support behind each of the two competing budget reports was confusing, at best. Behind the majority report were the Senate Democrats and Republicans and the House Democrats. Behind the more conservative minority report were the House Republicans and Governor LePage.

The majority report was originally agreed upon on the condition that the Democrats would support an amendment to the Maine Constitution which would require a two-thirds majority vote to increase the state income tax any time in the future. Since the original agreement, Democrats have stated that the provision was off the table. Originally, It was unclear to most as to whether or not the legislature would be able to come to an agreement that would have the necessary withstand the Governor's threatened veto.

Fortunately for the state, both the Democrat-controlled House and the Republican-controlled Senate voted in approval of this compromise plan with little opposition. While this budget makes a variety of changes to taxes, including an income tax cut, the expansion of the sales tax to now-exempt services, including cosmetic medical procedures, was not in the final package.

The Governor used his line-item veto powers to veto 64 separate items in the budget. As both the Senate and the House had passed the budget with over two-thirds support, they were easily able to overturn the vetoes without any debate after taking over 250 separate votes between the two legislative chambers to overcome each line-item. Governor LePage went on to say, "For five months they wasted our time. This time I am going to waste a little bit of their time."