Sec. 1. 36 MRSA c. 841, as amended, is repealed.

Sec. 2. 36 MRSA §5111, as amended by PL 1991, c. 824, Pt. A, §§76 to 78 and affected by §§79, 92 and 93, is repealed and the following enacted in its place:

§5111.__Imposition and rate of tax

A tax is imposed for each taxable year beginning on or after January 1, 2000 on the Maine taxable income of every resident individual of this State.__The amount of the tax is 5%.

Sec. 3. 36 MRSA §5111-A, as repealed and replaced by PL 1987, c. 819, §3, is repealed.

Sec. 4. 36 MRSA §5124-A, as amended by PL 1989, c. 596, Pt. J, §7, is repealed and following enacted in its place:

§5124-A.__Standard deduction; resident

The standard deduction for resident taxpayers who are married persons filing jointly is $25,000; the standard deduction for all other resident taxpayers is $10,000.

Sec. 5. 36 MRSA §5126, as amended by PL 1997, c. 643, Pt. HHH, §§4 and 5 and affected by §10, is repealed.

Sec. 6. Application. This Act applies to tax years beginning on or after January 1, 2000.

SUMMARY

This bill changes the existing graduated income tax program into a flat tax rate income tax, effective for tax years beginning on or after January 1, 2000.