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BY KEVIN WACK
Blethen Maine Newspapers 05/22/2008

Blethen Maine Newspapers

New state taxes on beer, wine and soda are at the center of an emerging showdown between anti-tax activists and health-care advocates.

Business groups that hope to repeal the beverage taxes kicked off a signature-gathering campaign on Wednesday with a news conference in Portland.

But they did not have the stage to themselves. Also on hand were health-care advocates who say that eliminating the taxes would jeopardize health care for thousands of Maine residents.

At issue is a law -- signed last month by Gov. John Baldacci -- that roughly doubles taxes on sales of certain beers and wines, and adds a new tax on syrup used to make soft drinks. The taxes are expected to generate around $20 million per year, most of which would be used to fund the state's Dirigo Health program, an effort to expand access to health insurance.

The group of businesses seeking to repeal the wholesale taxes is called Fed Up With Taxes. Billed as a bipartisan group, its members include the Maine State Chamber of Commerce, the Maine Restaurant Association and the Maine Beer and Wine Wholesalers Association.

"Maine people already pay some of the highest taxes in the country," Newell Augur, the group's director, said during the news conference outside David's Restaurant in Monument Square. "This is absolutely the worst time to ask Maine people to pay even more."

The group hopes to use a provision of the state Constitution that allows for a "People's Veto" of laws passed by the Legislature.

In order to put the question on the Nov. 4 statewide ballot, the coalition must gather 50,087 signatures by July 17.

The signature drive is being funded by individuals, Maine businesses and trade associations, Augur said.

One of the business owners who spoke against the beverage taxes was David Turin, the owner of David's Restaurant. Turin said he's been trying to hold down prices on his menu, but his overall costs have increased by 8.5 percent in the last year. He said he will have to pass the new taxes along to customers.

"We have been trying our hardest to sort of hold the line," he said. "But I think we're kind of reaching a point of inevitability."

After the outdoor news conference ended, health-care advocates who had also converged in Monument Square handed out their own press releases to members of the media.

"Taxes are tough to stomach in these tough economic times," Cherilee Budrick of Consumers for Affordable Health Care said in a statement that she distributed. "But (the tough economy is) all the more reason keeping this law in place is so important. If you lose your job tomorrow, don't you want to know that there's another option for health care for your family?"

Dr. Lisa Letourneau of the Maine Medical Association said it makes sense to fund health care with taxes on items, like beer and soda, that contribute to poor health. "The proponents of this 'People's Veto' were very careful not to talk about what the money will go to do," she said.

Megan Hannan of the American Cancer Society said her group has already been in talks with allies about how to oppose the campaign to repeal the tax.

Augur said there has to be a better way than new beverage taxes to fund Dirigo Health, but he offered no suggestions. He said Dirigo should not be funded with a special tax; its merits should rise or fall just like any other state program.

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