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CLT UPDATE
Tuesday, May 5, 2015
CLT defends the voters' mandate
for 5% income tax rate
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As Democrats in the Legislature push plans to
freeze the income tax rate at 5.15 percent, the group that led a
successful ballot law campaign 15 years ago says it's time for the
Legislature to drop the rate to 5 percent in accordance with that
law.
Citizens for Limited Taxation plans to
testify Tuesday before the Revenue Committee for a bill (H 2598)
reducing the income tax rate to 5 percent on July 1, a move the
group says would fulfill the promise of a ballot question that
passed by a 59-41 margin in 2000. Two years later, the Legislature
put the rate reduction on hold....
"There is also no need for a commission (H. 2631)
to study all of this, since The Promise, followed by the 2000 voter
mandate, was perfectly clear: restore the income tax rate to its
traditional 5 percent," CLT associate director Chip Faulkner wrote
in a memo to the Revenue Committee.
State House News Service
Tuesday, May 5, 2015
CLT not giving up on "Promise" of 5 percent income tax rate
"It's about time we got down to 5 percent," said
Chip Faulkner, associate director at the Citizens for Limited
Taxation, pointing to a 2000 ballot question passed by voters
that called for the rollback. In 2002, lawmakers froze the reduction
and set up triggers to allow for a more gradual reduction.
The Massachusetts Teachers Association submitted
written testimony opposing the bill, filed by Rep. Marc Lombardo
(R-Billerica), to reduce the income tax. The union also said it
opposed bills lowering the sales tax to 5 percent and establishing a
one-year waiting period for new taxes (H 2641).
State House News Service
Tuesday, May 5, 2015
Lawmakers consider ways to pay for income tax credit expansion
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Chip Ford's CLT
Commentary
It was busy here today —
the Revenue Committee's hearing on the CLT tax rollback to its
historic 5 percent — where it was until
twenty-six years ago. Remember when then-Gov. Dukakis hiked it
"temporarily"? Chip Faulkner went before the committee to
defend taxpayers — and the voters.
I assume we still matter?
Download a PDF copy
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Chip Ford |
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State House News Service
Tuesday, May 5, 2015
CLT not giving up on "Promise" of 5 percent income tax rate
By Michael Norton
As Democrats in the Legislature push plans to freeze the income tax
rate at 5.15 percent, the group that led a successful ballot law
campaign 15 years ago says it's time for the Legislature to drop the
rate to 5 percent in accordance with that law.
Citizens for Limited Taxation plans to testify Tuesday before
the Revenue Committee for a bill (H 2598) reducing the income tax
rate to 5 percent on July 1, a move the group says would fulfill the
promise of a ballot question that passed by a 59-41 margin in 2000.
Two years later, the Legislature put the rate reduction on hold.
CLT says voters were also promised that a 1989 increase in the
income tax would be temporary and that the rate would be reduced to
5 percent. In addition to opposing bills to increase the income tax
rate, CLT plans to oppose legislation (H 2631) sponsored by Weymouth
Democrat Rep. James Murphy calling for an income tax cut study.
"There is also no need for a commission (H. 2631) to study all of
this, since The Promise, followed by the 2000 voter mandate, was
perfectly clear: restore the income tax rate to its traditional 5
percent," CLT associate director Chip Faulkner wrote in a memo to
the Revenue Committee.
Rep. Denise Provost (D-Somerville) last week offered and then
withdrew a budget amendment freezing the income tax rate at 5.15
percent and Sen. Benjamin Downing (D-Pittsfield) said last week he
is considering filing a budget amendment to increase the earned
income tax credit while freezing the income tax rate at 5.15
percent. During his 2010 campaign, Charlie Baker made a 5 percent
income tax rate a priority.
State House News Service
Tuesday, May 5, 2015
Lawmakers consider ways to pay for income tax credit expansion
By Gintautas Dumcius
To hear Megan Sandel tell it, an income tax credit for low-income
families is akin to a prescription that can reduce the risk of
pre-term births and low birthweight babies.
Testifying before the Legislature's Joint Committee on Revenue,
Sandel pointed to studies that the earned income tax credit helped
reduce low birth weight by 7 percent overall and by 8.2 percent
among African Americans. A Federal Reserve Bank of Chicago study
said recipients of the tax credit buy healthier food, according to
Sandel.
Sandel, an associate professor of pediatrics and public health at
Boston University's School of Medicine, said increasing the tax
credit would "improve the health of my patients" by helping families
buy food, pay rent and keep the heat and lights on.
"In this case, if you saw that it was going to have this type of an
effect on low birthweight rates, pre-term birth, children's health,
then I think it's a great investment of money," she said.
Gov. Charlie Baker proposed a state earned income tax credit
increase to 30 percent of the federal credit, effectively doubling
it, and tied it to the elimination of the film tax credit as the way
for the state to pay for the expansion. He filed the proposal (H 62)
separately from his budget plan, and the Revenue Committee held a
hearing on it on March 31.
Rep. Jay Kaufman, House chair of the Joint Committee on Revenue,
said Tuesday the earned income tax credit has "universal" support.
"The only question is how much and how to pay for it," he said.
Asked his ideas on paying for it, Kaufman, a Lexington Democrat,
said, "Lots of ideas, no recommendation at this point."
Sandel and others backed legislation (S 1477) on Tuesday increasing
the tax credit to 50 percent, saying it would provide a maximum
benefit of $3,121. The bill was filed by Sen. Jamie Eldridge
(D-Acton).
As a way to pay for the increase, Sandel said she supports Sen.
Benjamin Downing's proposal (S 1475), which freezes the state income
tax rollback, keeping it at 5.15 percent instead of allowing it to
gradually decrease to a voter-approved level of 5 percent when
annual economic triggers are satisfied.
Downing indicated last week he is considering filing the bill as an
amendment when the Senate takes up its version of the fiscal 2016
budget later this month.
The House's budget proposal, passed in April, does not touch on
Baker's proposal to increase the earned income tax credit and phase
out the tax credit for film productions.
"The rules of engagement for us were that if there's a bill before
the committee, the committee process will be allowed to run its
course," Kaufman said.
Sen. Michael Rodrigues, a Westport Democrat and co-chair of the
Revenue Committee, said the governor's plan provides a "concrete
method" to pay for the tax credit increase.
"We haven't developed that method yet in the Senate, but I think --
and I won't speak for my House colleague -- I'm certainly committed
to increasing the earned income tax credit and finding a way to pay
for it," he said.
The Revenue Committee also took testimony on a bill (H 2598) that
would restore the state income tax rate to 5 percent by July 1,
2015.
"It's about time we got down to 5 percent," said Chip Faulkner,
associate director at the Citizens for Limited Taxation,
pointing to a 2000 ballot question passed by voters that called for
the rollback. In 2002, lawmakers froze the reduction and set up
triggers to allow for a more gradual reduction.
The Massachusetts Teachers Association submitted written testimony
opposing the bill, filed by Rep. Marc Lombardo (R-Billerica), to
reduce the income tax. The union also said it opposed bills lowering
the sales tax to 5 percent and establishing a one-year waiting
period for new taxes (H 2641).
"Until such a time as there is adequate revenue to fund the programs
necessary for our collective well-being as witnessed in an educated
workforce able to fully participate in this economy, proposals which
do not enhance the public good and negatively impact the available
revenue stream should be avoided," wrote Catherine Fichtner, a
lobbyist for the union.
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NOTE: In accordance with Title 17 U.S.C. section 107, this
material is distributed without profit or payment to those who have expressed a prior
interest in receiving this information for non-profit research and educational purposes
only. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml
Citizens for Limited Taxation ▪
PO Box 1147 ▪ Marblehead, MA 01945
▪ 508-915-3665
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