- Associated Press - Tuesday, February 3, 2015

AUGUSTA, Maine (AP) - In his State of the State address on Tuesday, Republican Gov. Paul LePage called on a politically divided Maine Legislature to support his $6.3 billion budget that includes an ambitious plan to overhaul the tax code.

Here’s what you need to know about LePage’s speech:

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TAXES

LePage used much of his roughly 50-minute speech to stump for his tax plan, which he said will modernize the state’s antiquated tax code and shift more of the burden onto tourists.

“The government should be allowing you to keep your hard earned money,” he said before the joint session of the Democratic-controlled House and Republican-led Senate.

LePage wants to cut the corporate and personal income tax and eliminate the estate tax and tax on military pensions. He’s also proposing to raise the sales tax by 1 percentage point and expand it to cover more services.

The governor said that a young married couple claiming a standard deduction would see their taxes go down by $1,500 under his plan. He says that Mainers would see their overall tax burden reduce reduced by $300 million by 2019.

He also urged the Legislature to consider amending the constitution to direct all future revenue growth toward eventually eliminating the income tax.

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SHARP WORDS

LePage sharply criticized the Maine Municipal Association, which is fighting his proposal to eliminate state aid to cities and towns.

The group has said that further cuts to revenue sharing will force cities and towns to raise property taxes.

LePage said it should be called the “Middle Man Association” because it pits local officials against taxpayers and blasted the group for consistently fighting for bigger, more expensive local government.

He also defended his plan to allow cities and towns to collect taxes from nonprofit organizations, saying that “everyone has to chip in” in order for the state to proper.

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THE ELDERLY

LePage touted his proposal to put $24 million into the state’s nursing homes and said his plan to eliminate the estate tax will ensure that more retirees stay in Maine.

He also stressed that the state must work to find more affordable heating options to help older adults, saying “that no Mainer who is 80-years-old should wrap herself in a heating blanket for weeks at a time because she cannot afford the high cost of oil.”

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BIPARTISANSHIP?

The governor who clashed frequently with the Legislature during his first term struck a bipartisan tone, stressing that he needs lawmakers’ help to take “bold action.”

“It is a first step, a big leap,” he said. “Friends, I cannot do it alone. I need your help.”

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LAWMAKERS REACT:

Democrats said that LePage’s budget will cause property taxes to spike and shift more of the burden onto low-and-middle-income families. They also warn that his plan will reduce state revenue by $400 million by 2019, which they argue will result in cuts to schools and other programs.

“It’s going to put a squeeze on things that all Mainers really want,” like education, said Senate Democratic Leader Justin Alfond of Portland.

Meanwhile, Senate Republican Leader Garrett Mason of Lisbon Falls praised the governor for “renewing his promise for watching over the Maine people.”

“You can say whatever you want about this governor, but he is 100 percent in the Maine people’s corner.”

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Follow Alanna Durkin at http://www.twitter.com/aedurkin

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