Help save yourself
— join CLT
today! |
CLT introduction and membership application |
What CLT saves you from the auto excise tax alone |
Make a contribution to support
CLT's work by clicking the button above
Ask your friends to join too |
Visit CLT on Facebook |
CLT UPDATE
Monday, May 23, 2016
Reactions to the
first vote on 6th Grad Tax assault
Citing the need for new tax revenues and
more fairness in tax policy, Massachusetts lawmakers
voted 135-57 Wednesday to advance a constitutional
amendment designed to generate $1.9 billion for
education and transportation by assessing a new 4
percent surtax on households with incomes above $1
million.
Before recessing their Constitutional Convention until
July 13, senators voted 33-7 in favor of the amendment,
with House members voting 102-50. Only 50 votes were
needed to advance the proposal....
In addition to being skeptical about whether the new
revenues would actually be spent for the intended
purposes, amendment opponents — mostly Republicans —
said the surtax would drive increasingly-mobile job
creators out of Massachusetts and lead to a system with
varied tax brackets.
"It is the introduction of class warfare," said Rep.
David Nangle (D-Lowell). He added, "It is stealing from
the rich to give to the poor." He called it a
"dereliction of duty" to foist the duties of lawmakers
— making decisions about taxation and spending — to
the ballot process....
While it attracted some votes from Democrats, an
amendment aimed at guaranteeing that the $1.9 billion
expected from the millionaire's tax be added to existing
spending on transportation and education failed 54-138.
Predicting that new revenue from a tax on millionaires
would supplant, rather than supplement, existing
spending on transportation and education, Jones said the
amendment would have codified the intentions of the
petitioners.
"Guess, what? You can't trust us, and the track record
of the Legislature proves that point," Jones said....
Senate Minority Leader Bruce Tarr questioned the
constitutionality of the directive that new tax revenues
be spent on education and transportation, and
recommended seeking an opinion from the Supreme Judicial
Court. Attorney General Maura Healey has certified that
the question does not violate a constitutional provision
preventing ballot questions from restricting the
Legislature's authority to appropriate tax dollars.
State House News Service
Wednesday, May 18, 2016
Mass. lawmakers advance surtax on millionaires with
135-57 vote
Massachusetts lawmakers took five
recorded votes Wednesday during a Constitutional
Convention where they advanced to the 2017-2018 session
a proposal to add a 4 percent surtax on household
incomes above $1 million. Massachusetts currently has a
flat 5.1 percent income tax rate....
The measure needed 50 votes to advance,
while amendments required three-quarters of lawmakers
voting to be adopted.
1. On advancing the measure to the next
convention: 135-57....
4. On a Rep. Brad Jones amendment aimed
at guaranteeing that the estimated $1.9 billion that
would be generated by the surtax not supplant existing
education and transportation spending, and be in
addition to that spending: 54-138.
State House News Service
Wednesday, May 18, 2016
After five recorded votes, surtax on millionaires
advanced to 2017-18 session
Supporters of a proposed constitutional
amendment adding a surtax on incomes over $1 million are
looking ahead to a year of planning and outreach after
lawmakers on Wednesday advanced the amendment to the
next legislative session....
Opponents also pledged to continue their
efforts. A
statement released by Citizens for Limited
Taxation said the group "will be prepared to fight
this latest noxious proposal all the way to the 2018
ballot – as we last did successfully in 1994."
The Massachusetts Republican Party, the
Massachusetts High Technology Council, the Massachusetts
Fiscal Alliance and others also voiced disappointment
and opposition to the vote on Wednesday.
State House News Service
Wednesday, May 18, 2016
Both sides readying for next stage of Millionaires Tax
fight
Amendment supporters call it the "fair
share" amendment, arguing that it will require wealthy
people to pay their fair share for state services. They
note that although high earners pay more taxes, measured
in dollars, they pay a lower percentage of their income
than poorer people to state and local taxes, including
sales and property taxes....
State Rep. Geoff Diehl, R-Whitman, said
once the tax system is divided into two brackets, that
creates a precedent to adopt more brackets, "ultimately
hitting the middle class the hardest once high income
earners move out of state."
The ballot question says the money would
be used for education and transportation. Because a
ballot question cannot allocate money, opponents of the
ballot question say the Legislature could divert the
money elsewhere – although supporters dispute that.
Tarr said the Supreme Judicial Court
should decide whether the amendment is constitutionally
allowed to require future legislatures to allocate money
that way. Lawmakers can ask the court for guidance,
although they have not yet done so here.
State Rep. John Velis, D-Westfield, was
among the Democrats who joined Republicans in voting
against the amendment.
"In Massachusetts, we need to do what we
can to reward our most industrious citizens," Velis
said. "If we impose these new types of taxes and
penalize our most industrious citizens, we run the risk
of them leaving." ...
State Rep. David Nangle, D-Lowell, said
the amendment "is the introduction of class warfare." If
it passes, Nangle said, lawmakers are likely to continue
to seek more revenue from taxpayers in lower and lower
income brackets.
The amendment is being pushed by Raise
Up Massachusetts, a coalition of unions, religious
leaders and liberal community organizing groups.
The Springfield Republican
Wednesday, May 18, 2016
Massachusetts Legislature passes 'millionaire's tax'
constitutional amendment
After a fiery debate that offered a
preview of the arguments for and against the levy — the
urgent necessity of new cash to boost education and
transportation in Massachusetts; the folly of a
constitutionally unsound “penalty on success” — 135 of a
combined 200 senators and representatives voted for the
measure. Fifty-seven voted against it....
Notably, the vote split Democrats, with
several fiscally conservative representatives and
senators voting against the measure....
The constitutional language aims to
direct the new infusion of revenue to only
transportation and education. But Senator Bruce E. Tarr,
the chamber’s top Republican, questioned whether the
wording of the proposal would actually mean lawmakers
could spend the cash as they saw fit.
Tarr also brought up the argument that
wealthy people might just leave the state, making the
new stream of revenue extremely unstable. He questioned
the wisdom of substantially increasing taxes on those
who are “among the most mobile in the Commonwealth in
terms of their ability to move capital, move their
residence, and avoid taxation all together.”
And the Gloucester Republican contended
that the new tax would be a “penalty on success” and
would send the message that, in this state, if you
achieve success, “the reward is nearly a doubling of
your taxation.”
House Republican Leader Bradley H. Jones
Jr. framed the new levy on the rich as a “Trojan tax
horse.” That’s because money is fungible and, he said,
there’s no guarantee that the new cash will be spent in
addition to money already spent on transportation and
education, not in lieu of it....
Paul Craney, executive director of the
Massachusetts Fiscal Alliance, expressed worry that the
effort would open the door to more taxes on everyone.
“And when the tax doesn’t generate the expected
revenue,” Craney said, “that million-dollar threshold
will crash down on the rest of us.”
Polling has found voters very favorable
to the idea of the surtax on the rich.
But history is on the side of opponents.
Voters have previously rejected five
proposals to change the Constitution to allow for a
graduated state income tax: In 1962, 1968, 1972, 1976,
and 1994.
The Boston Globe
Thursday, May 19, 2016
Lawmakers give millionaires’ tax overwhelming
endorsement
Massachusetts lawmakers have developed
an extraordinary new appreciation for the will of the
“people,” making a showy display of it yesterday during
a debate on a constitutional amendment that would impose
a higher income tax on the state’s millionaires.
History suggests such deference will not
last....
But as Balser and her Democratic
colleagues know, this “extraordinary popular movement”
is, in fact, a slick political operation with financial
support from — you’ll never guess — unions representing
public employees.
Affiliates of the AFL-CIO. Several
locals of the Service Employees International Union. The
Massachusetts Teachers Association. They have all been
generous contributors to the cause.
And Balser should take a few minutes to
look over the most recent financial report of Raise Up
Massachusetts 2018. The committee may not have paid a
professional signature-gathering company, but it spent
thousands on signature-gathering from all those
“volunteers.”
In its organizing documents the
committee defined its purpose as supporting investment
in public education and transportation “by asking the
wealthiest one percent to contribute their fair share.”
But Rep. David Nangle (D-Lowell), who voted against the
amendment, points out that in Massachusetts the “1
percent” would include anyone earning more than
$860,000.
So should this amendment pass in 2018
rest assured the “popular movement” will be back for
more — the will of the voters be damned.
A Boston Herald editorial
Thursday, May 19, 2016
The real winners
Some of the most spirited debate,
however, focused on how to ensure that lawmakers make
good on the proposal’s promise to allocate the surtax
revenue solely to education and transportation needs.
One potential solution, proposed by Republican leaders,
would have added a specific requirement to that effect.
Democrats rejected the move, arguing
that it wasn’t needed and claiming that a change in the
proposed ballot measure’s wording “means this would no
longer be a citizen’s petition,” to quote Sen. Ruth
Balser, a Newton Democrat.
“While there may be some sympathy for
this amendment, I want to remind my colleagues that
adopting any amendment will take this away from this
very impressive popular movement,” Balser added,
referring to changes sought by Republicans.
Rep. Bradley Jones, the Republican House
leader from North Reading, who introduced the proposed
change, argued that a safeguard is needed to show voters
the Legislature is committed to directing all additional
revenue raised by the measure to education and
transportation improvements.
“If you truly want to represent to the
voters of the commonwealth that this really isn’t a
Trojan tax-horse, that this is really as intended, then
you should vote for this amendment,” Jones said during
the debate. His proposal failed, 54-138....
Citizens for Limited Taxation, an
advocacy group that opposes the proposal, has cited a
previous move by the Legislature to increase a tax for a
specific purpose, saying that more than 90 percent of
the revenue brought in by the change – a near doubling
of the state gas tax – wasn’t spent as promised....
Citizens for Limited Taxation,
the group that backed the Proposition 2½ tax-capping
measure passed by voters in 1980, criticized lawmakers
for rejecting a change to prevent spending money the
proposed measure would raise on anything other than
education and transportation.
“This would have prevented fungible
revenue from being taken out of one pocket and stashed
into another – leaving that additional revenue free to
be spent anywhere, on the whim of any future
Legislature,” the group, also known as CLT, said
in a
statement. “It would have locked in the proponents’
promise.”
“That such unambiguous clarity was so
resoundingly defeated by so many supporters of this
scheme only underscores the bait-and-switch nature of
their proposal,” CLT said. “That such a majority of
supporters refused to demonstrate to voters their
sincerity of purpose in fact now defines their true
motivation.” ...
Massachusetts voters have previously
rejected all five ballot efforts aimed at changing the
state Constitution in order to enact a graduated state
income tax, most recently in 1994. After lawmakers
adopted a higher flat rate of 5.9 percent, voters in
2000 passed a ballot measure to roll it back to 5
percent, a legislatively delayed process that continued
with a cut this year to 5.1 percent from 5.15 percent in
2015.
The New Boston Post
Thursday, May 19, 2016
‘Millionaire’s tax’ wins key vote on Beacon Hill
The amendment states that all revenue
raised by the millionaires’ tax must support “quality
public education,” “affordable public colleges,” and
“the repair and maintenance of roads, bridges and public
transportation,” which could mean a spending boost of
around 20 percent for these priorities.
Opponents, however, are not convinced
that the money will be spent as promised, pointing to
legal uncertainty about whether the constitution can be
used to control legislative spending.
But legal arguments aside, it’s also
true that money is fungible. Even if the constitutional
language is binding, and all the revenue from the
millionaires’ tax goes to education and transportation,
that doesn’t necessarily mean the state will make big
investments in those areas. It might be able to keep the
current spending levels, use the new tax dollars to
cover a portion of those costs, and then do what it
likes with the money that’s been freed up because
there’s a new, dedicated source of education and
transportation funding.
The Boston Globe
Thursday, May 19, 2016
Mass. prepares for fight over proposed millionaires’ tax
By Evan Horowitz
If at first they don’t succeed, they
will try, try again. Over and over and over.
A recent vote on Beacon Hill placed the
latest incarnation of a "millionaire’s tax" on the
agenda of the upcoming Massachusetts Constitutional
Convention. It is called the "Fair Share Tax," sponsored
by Raise Up Massachusetts, which has already brought you
the new paid family leave law, and seeks to enact the
$15 minimum wage along with this new tax....
The beneficiaries of this projected $2
billion in new revenue would be the usual suspects –
public schools and transportation agencies, better known
as "our failing public schools and crippled
transportation systems." Government can become larger on
the proceeds of private-sector income through spending
on obscenely overpriced public construction projects,
costing about 40 percent more than comparable private
sector ones because of prevailing wage and other
protectionist bureaucracies.
The Cape Cod Times
Thursday, May 19, 2016
'Fair Share Tax' on millionaires everything but fair
By Cynthia Stead
A coalition of labor unions and
community groups are rallying around a controversial
proposal to funnel more state revenue into education and
transportation by imposing an additional tax on the
state's wealthiest residents....
Progressive Democrats, including Senate
President Stanley Rosenberg, D-Amherst, have for years
pushed a graduated income tax, similar to the federal
system, in which low-income taxpayers pay at a lower
rate than those with larger incomes. The state's voters
have rejected those efforts five times, most recently in
1994....
The state Constitution has been amended
only 121 times since it was ratified in 1780, according
to the Secretary of State's office. Voters most recently
changed it in 2006, when they approved the state's
health care law.
In 2004, Senate and House lawmakers held
a contentious constitutional convention to debate
same-sex marriage after the state Supreme Judicial Court
ruled that gays and lesbians should be allowed to marry
in the commonwealth.
That convention ended after lawmakers
declined to vote on a proposal to ban same-sex
marriage....
The fiscal watchdog group Citizens
for Limited Taxation has criticized the proposed
constitutional amendment as a "millionaires' tax" that
will drive out the state's top earners and provide even
less tax revenue for state coffers.
"The multi–millionaires who have been
providing hundreds of thousands in state income tax
revenue would then contribute ZERO," said Chip Faulkner,
the group's communications director. "It would kill the
golden goose."
The Salem News
Thursday, May 19, 2016
Millionaires' tax proposal clears hurdle on Beacon Hill
Citizens for Limited Taxation was
out with a
memo to legislators this week warning them to “kill
the creature” — meaning a graduated income tax — “before
it advances.”
It warns that the effort to impose a 4
percent surtax on salaries in excess of $1 million
annually is just the first step toward the graduated
income tax previously rejected by voters. It also points
out that an effort to hike the gas tax was turned down
by voters less than two years ago.
“Once the commonwealth’s historic flat
tax is abolished — and that is what this proposed
amendment would do — the power to constitutionally tax
at different rates will have been established (and) it
will be only a matter of time before the rest of us will
eventually become their victims.
“Lest we forget,” the memo continues,
“the usual list of suspects who opposed Proposition 2½,
the reduction of the auto excise, the elimination of the
7½ percent income tax surtax, the income tax rollback
... are now behind this sixth grad tax assault.”
The Salem News
Friday, May 20, 2016
Another tax battle looms
By Nelson Benton
A day after House and Senate Republicans
waged an unsuccessful fight against advancing a proposed
surtax on households with incomes above $1 million in
Massachusetts, Gov. Charlie Baker declined to slam the
door shut on the possibility of him supporting the tax
two years from now when, presumably, he will be on the
ballot running for re-election.
Baker has opposed any suggestion of
raising taxes during his first year-plus in office, and
repeated on Tuesday that he's "not a big believer" in
higher taxes to pay for new state spending.
But when pressed during a radio
interview on Thursday about how he might vote should the
tax proposal reach the ballot in 2018, Baker did not
take the same hard line expressed by other Beacon Hill
Republicans who have warned that the measure could be a
jobs killer.
"I don't know. Let's see where we are
when it gets there," Baker told WGBH's Boston Public
Radio host Jim Braude....
Baker, who refused during his last
campaign for governor to sign a no-new-taxes pledge,
described himself Thursday as a "let the people decide"
guy, and acknowledged that he had, in fact, signed the
tax petition on the same radio show after Braude
presented him with the papers. Supporters of the tax on
Wednesday repeatedly cited the petition's 157,000
signers as demonstrative of support for the idea....
Rep. Geoff Diehl, a Whitman Republican,
told his colleagues during debate Wednesday that "the
real intent of this quote unquote millionaire's tax is
nothing more than a bait and switch. It's just a way to
open the door to higher income tax rates all levels.
Once the tax code becomes divided between two brackets,
precedent will be set for creating new brackets and
making the code more and more progressive, also hitting
the middle class the hardest once high income earners
move themselves or their assets out of state."
State House News Service
Thursday, May 19, 2016
As GOP rips income surtax, Baker hangs on to
wait-and-see approach
A day after House and Senate Republicans
suggested the constitutional amendment to impose a
surtax on incomes over $1 million could be
unconstitutional, Attorney General Maura Healey was mum
when asked about the amendment's constitutionality....
Asked Thursday morning about Tarr's
concerns, the state's top prosecutor dodged the
question.
"When you're talking about education,
when you're talking about infrastructure, when you're
talking about transportation needs, we have needs right
now in our state and I think it's important that we
figure out how we're going to support those efforts and
fund those efforts," she said. "It's a good
conversation, it's a good debate and discussion and I
think it's in the right direction for where we need to
go given what we need to do."
Asked again if she is satisfied that the
question is constitutional, the attorney general said,
"We certified, as an office, this question for the
ballot and I know the debate will continue through the
Constitutional Convention this year and perhaps next
year as well."
Healey's office, as part of the
initiative petition process, reviews all petitions to
certify that they are legally eligible to appear on the
ballot.
State House News Service
Thursday, May 19, 2016
Asked about constitutionality of surtax, Healey pivots
to debate on issue
So perhaps Gov. Charlie Baker had been
infected with a bit of that Weldian keep-'em-guessing
spirit when he gently evaded a direct question on the
radio about whether he would vote against a proposed new
surtax on high income earners.
"I don't know," Baker said, after trying
to reinforce that he's "not a big believer in raising
taxes." "Let's see where we are when it gets there."
STORY OF THE WEEK: Lawmakers find it
easier to say yes to higher taxes when millionaires are
footing the bill.
QUOTE OF THE WEEK: "Guess what? You
can't trust us." - House Minority Leader Brad Jones on
whether voters should believe that revenue from a
"millionaire's tax" would be used to augment, rather
than supplant, current spending on transportation and
education.
State House News Service
Friday, May 20, 2016
Weekly Roundup - Whetting the
appetite
"Today's vote marks the first step in
changing our tax code to a more equitable and fair
system to fund our serious needs in transportation
infrastructure and education."
— Senate President Stan
Rosenberg, D-Amherst, on the Legislature's vote to
impose an additional 4 percent income tax on taxpayers'
earnings of more than $1 million.
"Citizens for Limited Taxation (CLT)
will be prepared to fight this latest noxious proposal
all the way to the 2018 ballot —
as we last did successfully in 1994."
— CLT's reaction to the
millionaire's tax.
Beacon Hill Roll Call
Sunday, May 21, 2016
Heard on the Hill
That’s the question being asked in a new
two-year statewide clinical experiment now underway at
the State House. The hackerama wants to find out what
will happen if they ask taxpayers to vote for income-tax
hikes — but only on “millionaires,” wink wink, nudge
nudge.
It’s a grift that can only end one way,
with everyone paying through the roof. The endgame is so
obvious that in five previous attempts the non-working
classes have tried to foist the “grad tax” on taxpayers,
they’ve been crushed — never by less than 64 percent of
the votes.
But the hacks haven’t gone to the well
since 1994, and of late the wisdom of the electorate has
been in a tailspin — Obama, Patrick, Warren, Markey,
Frank, etc., etc.
“Is it finally time?” the tax-fattened
hyenas ask one another, “Have we dumbed them ... just
enough?” At least one poll indicates that if the hacks
give the voters the blade in 2018, they’ll gladly slit
their own throats....
Not only do the hacks claim that they’ll
“only” hit millionaires, they also say the money will be
“earmarked” for education and transportation. Yeah,
right. The attempt itself may even be unconstitutional.
But who cares, right? ...
The state will quickly realize that the
supply of “millionaires” has failed. In order to deal
with the “shortfall,” the millionaire tax will have to
be adjusted downward — temporarily, of course — so that
everyone making more than, say, $30,000 a year will be
now designated for tax purposes as a millionaire. Look
on the bright side though, it’s for the children....
The problem for the welfare-industrial
complex is that no one believes anything they say. In
2000, the voters approved cutting the state income tax
back to 5 percent in a 60-40 landslide — and the rate
remains above 5 percent.
Rep. Jay Kaufman (D-Lexington) took
umbrage to Republicans’ pointing out that fact, saying,
“We will be at 5 percent as the voters have asked within
two years.”
In other words, by Fiscal 2019. The
Legislature will have given the voters what they
demanded ... in 2000 ... and they’re bragging about it.
“Following the will of the people,”
asked Rep. Jim Lyons (R-Andover), “is waiting 18 years
to reduce the rate to what they voted 18 years ago?”
The Boston Herald
Sunday, May 22, 2016
Driving out the rich
Millionaire tax surcharge an end run to our wallets
By Howie Carr
|
Chip Ford's CLT
Commentary
"Guess, what? You can't trust us, and the track record of the
Legislature proves that point."
House Minority Leader Brad Jones (R-North Andover) summed up this
latest Beacon Hill money grab quite succinctly in those few words.
From the usual grubby Gimme Lobby special interests trying to
scam low-information voters to feather their own nests, through the
More Is Never Enough tax-borrow-and-spenders in the Legislature
who've never seen a tax hike they didn't like, apparently all the
way to the top where Gov. Charlie Baker is doing his usual dithering
best, they're all singing from the same "progressive" hymnal.
"Trust us, we're not like the others!"
But with that one simple amendment to this latest proposed
Graduated Income Tax scam Rep. Jones called their bluff and exposed
their deceit. His amendment simply would have insured that all
additional revenue raised from a Grad Tax would be spent as
advertised, locked into education and transportation
— in addition to what is already
being spent in those areas, not as a substitute for current funding
(which if freed-up could then be spent on other or additional
"priorities" and boondoggles — by this
or future legislatures.
Amendment 11
—
Appropriated Funds
Representative Jones of North Reading, Senator Tarr of
Gloucester, Representatives Hill of Ipswich, Poirier of
North Attleborough, Gifford of Wareham, Frost of Auburn, and
Smola of Warren move to amend the bill by inserting, after
the word “purposes” in line 7, the following: “,
provided however that any funds appropriated shall be in
addition to and not in lieu of funds appropriated for such
purposes in the fiscal year most recently completed prior to
the enactment of this amendment.”
Rep. Jones' amendment to not deceive the voters about where the
new money will honestly be spent failed by a vote of 54 in favor and
138 opposed [Roll
Call Vote]. The vote to move forward the actual Graduated
Income Tax (aka; the "Millionaire's Tax" and/or the "Fair Share
Tax") to the next legislative session before going on the 2018
ballot passed by a vote of 135 in favor to 57 opposed [Roll
Call Vote].
Three more legislators voted to deceive voters than voted to
actually impose a Graduated Income Tax itself.
That one vote demonstrated the real agenda behind
this sixth Graduated Income Tax assault. If there were any who
naïvely believed this offense was "for
the children" or an "investment in our infrastructure," they have
been curtly disabused of that fiction. The promise of
"dedicated funds" being sold by the petition's advocates
— like so many others from the
tax-borrow-and-spend cabal — is nothing
more than another Beacon Hill bait-and-switch scam promoted by now
obvious false advertising.
As some have noted, this Grad Tax proposal has given cover to
More Is Never Enough (MINE) legislators, has provided them with the
best of all worlds. They can hide behind "the voice of the
people" and "let the voters decide" bromides while encouraging
higher taxes on a minority. "Hey, we didn't vote to hike
taxes" will be the universal cover story if it is adopted
— but they're already dreaming of how
they'll spend it. Even Republican Governor Charlie Baker has
assumed the position, after signing the petition while it was being
circulated. Supposedly he's not in favor of hiking taxes, but . . .
"Let's see where we are when it gets there" is his response.
When have the Bacon Hill powers-that-be ever listened to
the voice of the people, or honored the voters' decisions when they
didn't like the results?
The "temporary income tax hike" that voters overwhelmingly
demanded be rolled back to 5% sixteen years ago, ten years
after it was first imposed, still has not reached the voters'
mandated 5% — yet Rep. Jay Kaufman
(D-Lexington) thinks we should be grateful that it still might,
someday perhaps if decades late.
During the
Constitutional Convention debate during debate of another
amendment by Rep. Brad Jones to drop the income tax rate to 5%,
Kaufman had the audacity to assert:
We have honored and trusted the will of the voters, as my
co-chair said. We will be at 5 percent as the voters have
asked within two years. There is no question that we can and
do honor the will of the voters.
Rep. Jay Kaufman, the voters did not "ask"
— the voters ordered, they
mandated. A large majority voted for our rollback
— just like your constituents voted for
you and you're still there. Representative. Consider
carefully that passing and honorific title, Mr. Kaufman, recognize
and appreciate what it connotes. You work for us.
You and your colleagues in the Legislature are our employees
— you are "public servants." We
pay you a healthy salary and generous benefits while in our
employment and beyond. You do not rule over your
constituents, but serve them.
That amendment too was defeated, 147 nays to 42 in favor. [Roll
Call Vote]
But we should trust them, they say.
And they wonder how and why the citizenry has ever reached this
record level of public cynicism.
Constitutional Convention
H-3933
— the 6th proposed Graduated Income Tax
(aka, the "Millionaire's Tax"
aka, the "Fair Share Tax")
Wednesday, May 18, 2016
The Full Debate
|
|
Chip Ford
Executive Director |
|
|
|
State House News Service
Wednesday, May 18, 2016
Mass. lawmakers advance surtax on millionaires with 135-57 vote
By Michael Norton, Matt Murphy and Colin A. Young
Citing the need for new tax revenues and more fairness in tax
policy, Massachusetts lawmakers voted 135-57 Wednesday to advance a
constitutional amendment designed to generate $1.9 billion for
education and transportation by assessing a new 4 percent surtax on
households with incomes above $1 million.
Before recessing their Constitutional Convention until July 13,
senators voted 33-7 in favor of the amendment, with House members
voting 102-50. Only 50 votes were needed to advance the proposal.
Sen. Jason Lewis said the tax change would assist lower income
households who he said are paying a higher share of income in taxes.
Lewis contrasted the state's "shameful" rising child poverty rate
with the disproportionate share of new income and wealth that has
flowed to people who are "already very rich."
"The tax structure that we have is not sufficient to support the
needs of the commonwealth," said Lewis, a Winchester Democrat who
asserted that years of rising health care costs have snuffed out
inflation-adjusted investments in transportation, education, public
health and mental health programs.
In addition to being skeptical about whether the new revenues would
actually be spent for the intended purposes, amendment opponents —
mostly Republicans — said the surtax would drive
increasingly-mobile job creators out of Massachusetts and lead to a
system with varied tax brackets.
"It is the introduction of class warfare," said Rep. David Nangle
(D-Lowell). He added, "It is stealing from the rich to give to the
poor." He called it a "dereliction of duty" to foist the duties of
lawmakers — making decisions about taxation and spending — to the
ballot process.
Massachusetts currently has a flat 5.1 percent income tax rate. If
the amendment receives at least 50 votes from lawmakers meeting in
another Constitutional Convention during the 2017-2018 session, the
proposal would be placed before voters in November 2018 for a
binding vote.
Voting 42-147, lawmakers rejected a proposal from Republicans to
lock in a 5 percent tax rate on incomes of less than $1 million.
House Minority Leader Brad Jones called the amendment "the best of
both worlds for some here" because it preserved the millionaire's
tax proposal but added language to ensure a stable tax rate on those
earning less than $1 million.
While it attracted some votes from Democrats, an amendment aimed at
guaranteeing that the $1.9 billion expected from the millionaire's
tax be added to existing spending on transportation and education
failed 54-138.
Predicting that new revenue from a tax on millionaires would
supplant, rather than supplement, existing spending on
transportation and education, Jones said the amendment would have
codified the intentions of the petitioners.
"Guess, what? You can't trust us, and the track record of the
Legislature proves that point," Jones said.
Jones also offered an amendment that would have struck out the
language of the citizen's petition and replaced it with a flat
income tax rate of 5 percent for all taxpayers. It failed on a
42-148 vote.
"We propose that because that is what the voters of the commonwealth
voted to do 16 years ago this November," Jones said, referencing the
successful 2000 ballot question to reduce the state personal income
tax rate in steps over three years to 5 percent. "Let's start this
debate by honoring the will of the voters, the clear and vast
majority of which said they wanted a 5 percent income tax rate."
The constitutional amendment, proposed by the Raise Up Coalition
which gathered 157,000 voter signatures to back up their proposal,
changes a 1917 provision that requires a uniform tax rate for all
citizens.
Rep. Jay Kaufman, who introduced the proposal, described the current
tax system as "regressive" with higher-income earners paying a lower
effective tax rate than low-income families. Kaufman, of Lexington,
said the state's transportation and public education systems are
chronically underfunded, holding back the state's economic growth.
"We have an unsustainable tax system. We are not able to raise the
revenue needed to provide fundamental services for the citizens of
our cities and towns," Kaufman said.
Senate Minority Leader Bruce Tarr questioned the constitutionality
of the directive that new tax revenues be spent on education and
transportation, and recommended seeking an opinion from the Supreme
Judicial Court. Attorney General Maura Healey has certified that the
question does not violate a constitutional provision preventing
ballot questions from restricting the Legislature's authority to
appropriate tax dollars.
Calling the measure a "success penalty," Tarr also expressed concern
that millionaires would leave the state, hurting economic growth.
State House News Service
Wednesday, May 18, 2016
After five recorded votes, surtax on millionaires advanced to 2017-18
session
Massachusetts lawmakers took five recorded votes Wednesday during a
Constitutional Convention where they advanced to the 2017-2018 session a
proposal to add a 4 percent surtax on household incomes above $1
million. Massachusetts currently has a flat 5.1 percent income tax rate.
If the amendment secures 50 votes in the next session, it will be placed
before voters statewide for a vote in November 2018. Here's a breakdown
of the votes that occurred on the constitutional amendment (H 3933)
during Wednesday's convention.
The measure needed 50 votes to advance, while amendments required
three-quarters of lawmakers voting to be adopted.
1. On advancing the measure to the next convention: 135-57.
2. On a Rep. Brad Jones amendment striking the text of the amendment and
inserting new text establishing in the state constitution a flat 5
percent income tax rate: 42-148.
3. On a Rep. Brad Jones amendment preserving the millionaire's tax
language but adding language to lock in a 5 percent tax on incomes of
less than $1 million: 42-147.
4. On a Rep. Brad Jones amendment aimed at guaranteeing that the
estimated $1.9 billion that would be generated by the surtax not
supplant existing education and transportation spending, and be in
addition to that spending: 54-138.
5. On Norfolk Republican Rep. Shawn Dooley's amendment that would have
set a cap ensuring that no taxpayer, regardless of additional taxes that
may apply depending on the source of income, pay a rate higher than 9
percent on income over $1 million: 39-153.
State House News Service
Wednesday, May 18, 2016
Both sides readying for next stage of Millionaires Tax fight
By Katie Lannan
Supporters of a proposed constitutional amendment adding a surtax on
incomes over $1 million are looking ahead to a year of planning and
outreach after lawmakers on Wednesday advanced the amendment to the next
legislative session.
During a Constitutional Convention, legislators voted 135-57 in favor of
a petition that would assess a new 4 percent surtax on household income
above $1 million, with the extra revenue intended to fund education and
transportation. Another vote with at least one quarter of the
legislature in favor would be needed during the 2017 to 2018 session for
the measure to land on the November 2018 ballot.
Massachusetts Teachers Association president Barbara Madeloni, a
supporter of the surtax campaign, said proponents will use the next year
to "begin to imagine the kind of commonwealth that we want."
"We're going to be out there," Madeloni told the News Service. "We have
another ConCon to move this along, but I think that it will be really
important to be having conversation with the people in the commonwealth
about what we want our public schools to look like, what do we want for
higher education — how we can begin to imagine together the
possibilities of using this funding to improve public education."
Opponents also pledged to continue their efforts. A
statement released
by Citizens for Limited Taxation said the group "will be prepared
to fight this latest noxious proposal all the way to the 2018 ballot –
as we last did successfully in 1994."
The Massachusetts Republican Party, the Massachusetts High Technology
Council, the Massachusetts Fiscal Alliance and others also voiced
disappointment and opposition to the vote on Wednesday.
The Springfield Republican
Wednesday, May 18, 2016
Massachusetts Legislature passes 'millionaire's tax' constitutional
amendment
By Shira Schoenberg
The Massachusetts Legislature on Wednesday voted to pass a
constitutional amendment raising taxes on income over $1 million. The
vote, which came after three hours of debate, marked the first step in a
long process that could change the tax code through a 2018 ballot vote.
State Rep. Jay Kaufman, D-Lexington, chairman of the Joint Committee on
Revenue, argued in favor of the amendment, saying the state needs more
money. "We have an unsustainable tax system. We're not able to raise the
money that we need to provide in order to fund fundamental services for
the citizens of our cities and towns," Kaufman said.
To pass, the constitutional amendment needed 50 votes in the 200-person
State Legislature at Wednesday's constitutional convention, and must
pass by the same margin in a second vote next year. It must then get
support from a majority of voters in the November 2018 election.
The amendment received support from 135 lawmakers in Wednesday's vote,
with 57 voting against it.
Currently, Massachusetts has a flat tax, which means everyone pays 5.1
percent of their income. That is scheduled to gradually decrease to 5
percent.
The proposed constitutional amendment would raise the tax rate by 4
percentage points on income over $1 million. So if the flat tax in 2019
is 5 percent, someone earning $1.3 million would pay 5 percent on the
first $1 million of income and 9 percent on the next $300,000.
The Department of Revenue estimates that the proposed tax rate would
raise an additional $1.9 billion in 2019, around $1.7 million measured
in today's dollars.
Amendment supporters call it the "fair share" amendment, arguing that it
will require wealthy people to pay their fair share for state services.
They note that although high earners pay more taxes, measured in
dollars, they pay a lower percentage of their income than poorer people
to state and local taxes, including sales and property taxes.
Raising taxes across the board, Kaufman said, "would disproportionately
impact those least able to afford it while continuing to favor those who
are most able to afford it."
State Sen. Ben Downing, D-Pittsfield, a member of the Revenue Committee
who supports the amendment, said, "We need more investments in education
and transportation, especially in Western Massachusetts, if we're going
to grow the economy and create economic opportunities we want for
everyone."
Downing said he believes the public should get a chance to vote.
Opponents say the amendment would hurt wealthy taxpayers, who are the
most likely to create jobs and generate economic activity, and who are
most likely to leave the state because of high tax rates.
State Senate Minority Leader Bruce Tarr, R-Gloucester, said the proposed
tax increase would place the burden of funding transportation and
education on a small group of residents, who may leave. The amendment,
Tarr said, would "send a message in Massachusetts if you achieve
success, the reward is nearly a doubling of your taxation."
Tarr said voters previously rejected moving toward a graduated income
tax, in which wealthy individuals pay a higher rate. "We have for
decades embraced the theory that all the citizens of Massachusetts are
equal, and taxation will be applied equally," Tarr said.
State Rep. Geoff Diehl, R-Whitman, said once the tax system is divided
into two brackets, that creates a precedent to adopt more brackets,
"ultimately hitting the middle class the hardest once high income
earners move out of state."
The ballot question says the money would be used for education and
transportation. Because a ballot question cannot allocate money,
opponents of the ballot question say the Legislature could divert the
money elsewhere – although supporters dispute that.
Tarr said the Supreme Judicial Court should decide whether the amendment
is constitutionally allowed to require future legislatures to allocate
money that way. Lawmakers can ask the court for guidance, although they
have not yet done so here.
State Rep. John Velis, D-Westfield, was among the Democrats who joined
Republicans in voting against the amendment.
"In Massachusetts, we need to do what we can to reward our most
industrious citizens," Velis said. "If we impose these new types of
taxes and penalize our most industrious citizens, we run the risk of
them leaving."
Velis said residents are still hurting from the 2008 recession, and
Massachusetts should be inviting businesses in, not penalizing
successful business people.
"Now's not the time to dig deeper into people's wallets," Velis said.
State Rep. David Nangle, D-Lowell, said the amendment "is the
introduction of class warfare." If it passes, Nangle said, lawmakers are
likely to continue to seek more revenue from taxpayers in lower and
lower income brackets.
The amendment is being pushed by Raise Up Massachusetts, a coalition of
unions, religious leaders and liberal community organizing groups.
Steve Crawford, a spokesman for Raise Up Massachusetts, said he is
optimistic the amendment will reach the ballot and pass. "I think people
understand that we need to invest...in transportation and education...
and that asking the wealthiest people in the state to pay a little bit
more is the fair thing to do," Crawford said.
Phil Edmundson, past chair of the Alliance for Business Leadership, a
progressive business group, and area chairman of Arthur J. Gallagher &
Co., said, "The future strength of our economy depends on our ability to
make investments in education and transportation. The fair share tax
calls on the most fortunate among us to contribute a bit more to that
cause, in order to help create growth and opportunity for everyone in
Massachusetts."
According to 2013 Department of Revenue data, the most million-dollar
earners in Massachusetts – 1,617 – lived in Boston. The communities with
the highest concentrations of million-dollar earners are Weston, Dover
and Wellesley, suburbs west of Boston.
Several amendments were debated on the constitutional convention floor,
mostly proposed by Republicans, but none passed. Among other amendments,
Tarr and House Minority Leader Brad Jones, R-North Reading, tried to
require a supermajority vote any time money is spent from the state's
rainy day fund and tried to lower the flat tax rate to 5 percent.
The Boston Globe
Thursday, May 19, 2016
Lawmakers give millionaires’ tax overwhelming endorsement
By Joshua Miller
The Legislature on Wednesday overwhelmingly endorsed a constitutional
proposal to raise taxes on the very rich, setting the so-called
millionaires’ tax on track to go before voters in 2018.
After a fiery debate that offered a preview of the arguments for and
against the levy — the urgent necessity of new cash to boost education
and transportation in Massachusetts; the folly of a constitutionally
unsound “penalty on success” — 135 of a combined 200 senators and
representatives voted for the measure. Fifty-seven voted against it.
Only 50 votes were required to move the measure forward. And if the push
garners 50 votes in the next two-year legislative session, it will go
before voters on Nov. 6, 2018.
Notably, the vote split Democrats, with several fiscally conservative
representatives and senators voting against the measure.
But most in the majority party favored moving the effort forward, and
several made an impassioned case for what proponents frame as a “fair
share” tax. They see the move as part of a larger effort to address the
massive gap between the very wealthy and everyone else in Massachusetts.
They hope to provide resources needed to create a transportation system
that can get residents to work reliably and an education system that can
help students land jobs without accruing crippling debt.
“People hate taxes, we get it,” said Senator Karen E. Spilka, an Ashland
Democrat. “But people should also hate the idea that our children may
not be getting an adequate education to prepare them for competing in
our globalized economy. They should hate the fact that their loved ones
may waste hours of their lives commuting, and going on unsound bridges.”
The state’s current income tax rate is 5.1 percent for all income
levels. The amendment would impose an additional tax of 4 percent on
annual taxable income in excess of $1 million starting in 2019. And that
level would be tied to inflation, so the extra tax would continue to
apply only to very wealthy people.
Republican leaders offered several amendments to the proposal, all of
which were rejected. They also offered a barrage of arguments against
the measure.
The constitutional language aims to direct the new infusion of revenue
to only transportation and education. But Senator Bruce E. Tarr, the
chamber’s top Republican, questioned whether the wording of the proposal
would actually mean lawmakers could spend the cash as they saw fit.
Tarr also brought up the argument that wealthy people might just leave
the state, making the new stream of revenue extremely unstable. He
questioned the wisdom of substantially increasing taxes on those who are
“among the most mobile in the Commonwealth in terms of their ability to
move capital, move their residence, and avoid taxation all together.”
And the Gloucester Republican contended that the new tax would be a
“penalty on success” and would send the message that, in this state, if
you achieve success, “the reward is nearly a doubling of your taxation.”
House Republican Leader Bradley H. Jones Jr. framed the new levy on the
rich as a “Trojan tax horse.” That’s because money is fungible and, he
said, there’s no guarantee that the new cash will be spent in addition
to money already spent on transportation and education, not in lieu of
it.
The state Department of Revenue estimates that the constitutional change
would generate between $1.6 billion and $2.2 billion in additional state
tax revenues in 2019. The agency estimates that 19,500 returns will be
affected. That’s about 0.5 percent of all returns filed with the
department.
The millionaires’ tax came before the Legislature on Wednesday after
Raise Up Massachusetts, a coalition of religious, community, and union
groups, gathered over 157,000 signatures to put the measure on the
ballot.
“It’s absolutely clear we need to invest in improving our public
schools, repairing crumbling roads and bridges, making high-quality,
debt-free public college an option, and strengthening our public
transportation systems,” Deb Fastino, a co-chair of Raise Up, said in a
news release.
But Paul Craney, executive director of the Massachusetts Fiscal
Alliance, expressed worry that the effort would open the door to more
taxes on everyone. “And when the tax doesn’t generate the expected
revenue,” Craney said, “that million-dollar threshold will crash down on
the rest of us.”
Polling has found voters very favorable to the idea of the surtax on the
rich.
But history is on the side of opponents.
Voters have previously rejected five proposals to change the
Constitution to allow for a graduated state income tax: In 1962, 1968,
1972, 1976, and 1994.
The Boston Herald
Thursday, May 19, 2016
A Boston Herald editorial
The real winners
Massachusetts lawmakers have developed an extraordinary new appreciation
for the will of the “people,” making a showy display of it yesterday
during a debate on a constitutional amendment that would impose a higher
income tax on the state’s millionaires.
History suggests such deference will not last.
Arguing against several proposed changes to the amendment, supporters of
the tax hike insisted that even minor tinkering would violate the will
of the citizens who have proposed the amendment.
Several lawmakers cited the record number of signatures gathered by
supporters, and Rep. Ruth Balser (D-Newton) called on her colleagues to
respect the “extraordinary popular movement” — a movement “driven by the
concern for the growing income inequality in our state and in our
nation.” Of the signature-gathering campaign, she gushed it was “totally
armed by volunteers.”
But as Balser and her Democratic colleagues know, this “extraordinary
popular movement” is, in fact, a slick political operation with
financial support from — you’ll never guess — unions representing public
employees.
Affiliates of the AFL-CIO. Several locals of the Service Employees
International Union. The Massachusetts Teachers Association. They have
all been generous contributors to the cause.
And Balser should take a few minutes to look over the most recent
financial report of Raise Up Massachusetts 2018. The committee may not
have paid a professional signature-gathering company, but it spent
thousands on signature-gathering from all those “volunteers.”
In its organizing documents the committee defined its purpose as
supporting investment in public education and transportation “by asking
the wealthiest one percent to contribute their fair share.” But Rep.
David Nangle (D-Lowell), who voted against the amendment, points out
that in Massachusetts the “1 percent” would include anyone earning more
than $860,000.
So should this amendment pass in 2018 rest assured the “popular
movement” will be back for more — the will of the voters be damned.
The New Boston Post
Thursday, May 19, 2016
‘Millionaire’s tax’ wins key vote on Beacon Hill
By Evan Lips
It wasn’t a question of “if” but rather “how” lawmakers on Beacon Hill
would advance the “millionaire’s tax” proposal, a measure that calls for
altering the state Constitution’s flat tax to smack a surcharge on the
commonwealth’s highest earners.
Needing just a combined 50 votes from the Senate and House of
Representatives to move forward, the proposed ballot question breezed
through the Legislature’s Constitutional Convention Wednesday, passing
by 135 yeas to 57 nays. The Senate voted for the measure 33-7 while it
won 102-50 among House members.
Some of the most spirited debate, however, focused on how to ensure that
lawmakers make good on the proposal’s promise to allocate the surtax
revenue solely to education and transportation needs. One potential
solution, proposed by Republican leaders, would have added a specific
requirement to that effect.
Democrats rejected the move, arguing that it wasn’t needed and claiming
that a change in the proposed ballot measure’s wording “means this would
no longer be a citizen’s petition,” to quote Sen. Ruth Balser, a Newton
Democrat.
“While there may be some sympathy for this amendment, I want to remind
my colleagues that adopting any amendment will take this away from this
very impressive popular movement,” Balser added, referring to changes
sought by Republicans.
Rep. Bradley Jones, the Republican House leader from North Reading, who
introduced the proposed change, argued that a safeguard is needed to
show voters the Legislature is committed to directing all additional
revenue raised by the measure to education and transportation
improvements.
“If you truly want to represent to the voters of the commonwealth that
this really isn’t a Trojan tax-horse, that this is really as intended,
then you should vote for this amendment,” Jones said during the debate.
His proposal failed, 54-138.
The surtax may raise $1.9 billion a year, according to a Department of
Revenue projection. But millionaire taxes have failed to produce the
expected yield in other jurisdictions where they have been enacted,
including California, where state data shows a 21 percent drop in taxes
owed by those earning $1 million or more from 2012 to 2013, and their
ranks thinned by 7 percent. The year before, the number of millionaire
filers had risen by 26 percent and the amount they owed almost doubled.
In the debate, Jones also recalled a conversation he had with “the
proponent of the underlying question” whom he didn’t identify. Jones
said he asked whether advocates “felt obliged to spend the money” only
on education and transportation.
“‘Well, we’re not obliged to,’” came the reply, Jones said. “So they’re
already starting to talk about that Trojan Horse.”
“If you really believe the campaign rhetoric from those who support
this, if you really believe it, then you absolutely should support” the
proposed change to lock in the uses of the revenue, he said.
Sen. Michael J. Rodrigues, a Fall River Democrat, called Jones’ proposal
“redundant.” He also cited Balser’s argument against altering the
wording of the proposed initiative, saying any change would mean “that
this question is no longer a citizen’s petition – this question before
us becomes a legislative petition,” if the language changes.
Opponents of the proposal say that the state Constitution bars ballot
measures that would seek to spend tax dollars for specific purposes.
Some lawmakers on Wednesday suggested that the initiative at issue
should be reviewed by the state’s Supreme Judicial Court to make sure it
would be legal, if passed by voters.
The ballot proposal calling for an amendment to the state Constitution
was spearheaded by Raise Up Massachusetts, a union-driven coalition that
gathered about 157,000 signatures from registered voters in support of
the measure. It would change a 99-year-old policy requiring a uniform
income-tax rate for all taxpayers in the state.
Jones replied to Rodrigues by pointing out the Legislature’s track
record, which shows that there is a small chance additional tax revenue
will actually be used for prespecified needs such as transportation and
education.
“What I predict will happen is that money we currently spend on
education and transportation will be siphoned off elsewhere,” he said.
Citizens for Limited Taxation, an advocacy group that opposes the
proposal, has cited a previous move by the Legislature to increase a tax
for a specific purpose, saying that more than 90 percent of the revenue
brought in by the change – a near doubling of the state gas tax – wasn’t
spent as promised.
Rep. Shaunna O’Connell, a Republican from Taunton, said it was “not
clear by any stretch of the imagination” that the money will be used
solely for education and transportation.
“It will be a free-for-all, it will be like a new, shiny piggy bank for
this Legislature to spend that money in any way that they choose,” she
asserted.
Several Democrats voted against the Raise Up Massachusetts petition,
including Lowell Rep. David Nangle.
“It is the introduction of class warfare,” Nangle said during the
debate. “It is stealing from the rich to give to the poor.”
“We are legislators, not Robin Hood,” he added.
Just 17 Democrats in the House and two in the Senate voted against the
proposal. The sole Republican vote for the measure came from Weymouth
Sen. Patrick O’Connor, who was sworn in minutes before the debate began.
O’Connor won a recent special election to replace outgoing Sen. Richard
Hedlund.
All four changes sought by Republicans to alter the proposed ballot
measure went down in defeat.
Those included one that would have locked in the flat tax rate for
earners making less than $1 million, to counter an issue raised by
critics that should the proposed ballot measure pass, it would usher in
a fully graduated income tax structure like that imposed at the federal
level.
Immediately following Wednesday’s final vote, the Massachusetts Fiscal
Alliance, a taxpayer watchdog group, ripped lawmakers who backed the
proposal.
“Earmarking revenue and specifying tax brackets aren’t the sorts of
things that belong in our Constitution,” Paul Craney, the group’s
executive director, said in a statement. “Putting such a muddled mess on
the ballot is unfair to voters.”
Citizens for Limited Taxation, the group that backed the
Proposition 2½ tax-capping measure passed by voters in 1980, criticized
lawmakers for rejecting a change to prevent spending money the proposed
measure would raise on anything other than education and transportation.
“This would have prevented fungible revenue from being taken out of one
pocket and stashed into another – leaving that additional revenue free
to be spent anywhere, on the whim of any future Legislature,” the group,
also known as CLT, said in a
statement. “It would have locked in the proponents’ promise.”
“That such unambiguous clarity was so resoundingly defeated by so many
supporters of this scheme only underscores the bait-and-switch nature of
their proposal,” CLT said. “That such a majority of supporters refused
to demonstrate to voters their sincerity of purpose in fact now defines
their true motivation.”
The proposal still must clear more hurdles before it can reach the
November 2018 ballot, including going before lawmakers and winning 50
votes at another Constitutional Convention during the next legislative
session. Should voters pass it in 2018, it would take effect starting in
2019.
Massachusetts voters have previously rejected all five ballot efforts
aimed at changing the state Constitution in order to enact a graduated
state income tax, most recently in 1994. After lawmakers adopted a
higher flat rate of 5.9 percent, voters in 2000 passed a ballot measure
to roll it back to 5 percent, a legislatively delayed process that
continued with a cut this year to 5.1 percent from 5.15 percent in 2015.
The Boston Globe
Thursday, May 19, 2016
Mass. prepares for fight over proposed millionaires’ tax
By Evan Horowitz
The war over a Massachusetts millionaires’ tax is about to begin.
On Wednesday, legislators gave preliminary support to the measure,
firing the first shot in what could be a long, contentious fight to
raise taxes on those earning more than $1 million — and use the money to
make far-reaching investments in education and transportation.
Early surveys suggest broad support among voters, but victory is far
from assured. For one thing, backers need something more than a new law;
they need a constitutional amendment — because at present the state
constitution doesn’t allow for differential tax rates.
Plus, opponents have their own arsenal of powerful arguments, including
concerns that millionaires would simply move away, doubts about how the
new revenue would really be spent, and a general preference for fixing
the state budget by keeping taxes low and cutting wasteful spending.
What motivates this call for a millionaires’ tax?
1. Every year for the last decade, legislators have scrambled to fill a
wide budget deficit, leaving little left over for investments in
education or transportation.
2. With inequality on the rise, more and more of the money earned in the
state ends up in the pockets of the very richest.
3. When it comes to state and local taxes, those wealthy,
inequality-benefiting families actually pay a lower overall tax rate
than middle-class and poorer families.
4. A tax on millionaires could therefore raise substantial new revenue
while at the same time making our tax system more fair.
What, exactly, is being proposed?
Supporters want to add a paragraph to the state constitution, creating a
new 4 percent surtax on all income over $1 million — and stipulating
that revenue from this tax be used for public education and
transportation.
Roughly 20,000 households in the state would be affected by the new tax,
according to the state Department of Revenue. That means we’re talking
about the top 0.5 percent of households. The remaining 99.5 percent
would see absolutely no change in their tax bills.
The state could expect to raise about $1.9 billion additionally every
year with this tax. Just to give some context, that’s about the same
amount of money then-Governor Deval Patrick sought for his own 2013
proposal to invest in education and transportation.
Note that there’s no boundary problem here. If you make $999,999, you’re
not subject to the tax. But if you cross the threshold and earn
$1,000,001, only the extra dollar is taxed. So you’d owe just 4 cents
for the millionaires’ tax. And to keep up with inflation, the cut-off
would increase every year.
Don’t the rich already pay more in taxes?
Not when it comes to state and local taxes in Massachusetts. Like most
US states, Massachusetts has a regressive tax system.
When you add together the full spectrum of taxes, including the income
tax, sales tax, property tax, and excise taxes, lower-income families
actually pay a higher overall tax rate than rich families.
An analysis from the left-leaning Institute on Taxation and Economic
Policy found that while poor and middle-income families pay about 10
percent of their income in state and local taxes, the highest-earning
families pay just 6.5 percent.
Even if the millionaires’ tax passes, the situation won’t change all
that much. The top 1 percent will still pay a lower overall tax rate
than the average household.
Would millionaires flee Massachusetts?
Some millionaires may leave the state if the new tax passes —
particularly those with looser family and community ties.
But when you look at other states with elevated taxes on high-income
folks, it turns out this effect is surprisingly small. Set against the
millionaires who do take flight are others who move in and plenty of
rising millionaires who choose to stay — whether for the schools, to
maintain the business connections they’ve made, or to stay grounded in
their home communities.
That said, the loss of just one or two super-millionaires can cause
unexpected budget turmoil. That happened in New Jersey this year, when
the richest state resident took off for Florida, depriving the state of
hundreds of millions of tax dollars.
Will the money really be used for education and transportation?
The amendment states that all revenue raised by the millionaires’ tax
must support “quality public education,” “affordable public colleges,”
and “the repair and maintenance of roads, bridges and public
transportation,” which could mean a spending boost of around 20 percent
for these priorities.
Opponents, however, are not convinced that the money will be spent as
promised, pointing to legal uncertainty about whether the constitution
can be used to control legislative spending.
But legal arguments aside, it’s also true that money is fungible. Even
if the constitutional language is binding, and all the revenue from the
millionaires’ tax goes to education and transportation, that doesn’t
necessarily mean the state will make big investments in those areas. It
might be able to keep the current spending levels, use the new tax
dollars to cover a portion of those costs, and then do what it likes
with the money that’s been freed up because there’s a new, dedicated
source of education and transportation funding.
In reality, this is unlikely. A big infusion of new tax dollars will
probably boost spending on education and transportation. But it’s not
necessarily because of binding language in the millionaires’ tax. It’s
because these are top legislative and popular priorities, areas where
the Legislature would be eager to invest their new resources.
Why will this fight continue through 2018?
Amending the state constitution is a multistep process. First, a quarter
of legislators have to approve the amendment, which is what’s happening
Wednesday. Then, in the 2017-2018 legislative session, they have to
approve it again. Only then can it go to voters in the form of a ballot
initiative.
This lengthy process has a potentially worrisome correlate. If it turns
out there’s an error or problem with the amendment — or merely some
ambiguity requiring clarification — addressing it could require another
four-year process of constitutional re-amendment.
Aren’t there better ways to free up money for public investments?
When a state budget is out of balance, there aren’t a lot of options.
Either you cut spending on state programs, find temporary fixes, or
raise new revenue.
Massachusetts has mostly been following the path of small cuts and
temporary fixes. And we seem to be reaching the limit of that strategy.
Among other things, regular raids on the state’s “rainy day” fund have
drained away money that’s supposed to be reserved for tough economic
times, even though we’re in the midst of a steady economic recovery.
And while it’s true that a faster-growing economy might ease our budget
woes — filling state coffers with the proceeds from rising incomes and
profits — the growth would have to be truly unprecedented to match the
revenues from a millionaires’ tax. Something like 6 to 8 percent every
year, when it’s currently more like 2 to 3 percent.
After years of chronic budget deficits, and little evidence that
economic growth and state cutbacks can fix the root problem, advocates
are once again making the case for new revenue.
For now, polls show that roughly 70 percent of Bay Staters support the
millionaires’ tax. But, there’s plenty of time for minds to change, and
history gives reason for caution. This isn’t the first time advocates
have tried to create a tiered tax system via constitutional amendment,
and each prior attempt ended in defeat.
The Cape Cod Times
Thursday, May 19, 2016
'Fair Share Tax' on millionaires everything but fair
By Cynthia Stead
If at first they don’t succeed, they will try, try again. Over and over
and over.
A recent vote on Beacon Hill placed the latest incarnation of a
"millionaire’s tax" on the agenda of the upcoming Massachusetts
Constitutional Convention. It is called the "Fair Share Tax," sponsored
by Raise Up Massachusetts, which has already brought you the new paid
family leave law, and seeks to enact the $15 minimum wage along with
this new tax.
“Our proposed constitutional amendment would create an additional tax of
four percentage points on annual income above one million dollars, so
only those with the highest incomes would pay a little more," according
to the advocates. "The new revenue generated by this tax could only be
spent on quality public education, affordable public colleges and
universities, and for repair and maintenance of roads, bridges, and
public transportation. To ensure that the tax continues to apply only to
the highest income residents, who have the ability to pay more, the one
million dollar threshold would be adjusted each year to reflect
cost-of-living increases.”
So, like the gasoline tax effort, the tax will be indexed to inflation
to ensure it will entrap more and more earners.
The beneficiaries of this projected $2 billion in new revenue would be
the usual suspects – public schools and transportation agencies, better
known as "our failing public schools and crippled transportation
systems." Government can become larger on the proceeds of private-sector
income through spending on obscenely overpriced public construction
projects, costing about 40 percent more than comparable private sector
ones because of prevailing wage and other protectionist bureaucracies.
It is a bonanza for the few cities favored by the Chapter 70 education
formula, which is rigged to keep education monies in urban areas. New
Bedford may again receive more than 100 percent of its school funds from
the state and once again fund other municipal services with the surplus.
This effort is concerned about “effective” state and local tax rates,
allowing the wealthy to pay a smaller percentage of their disposable
income as taxes, thus leading to wealth inequality. There are mechanisms
in place to protect low earners like the Earned Income Tax Credit, the
personal exemption, and the low-income credit and no tax status, but
this merely protects those making the least. It doesn’t do anything to
make the rich pay more, and that is what this is all about, even if in
absolute dollars they do pay a greater amount. It just doesn’t hurt them
enough.
This needs to go through a constitutional process because a prior
generation of progressive advocates were successful. A century ago,
shortly after the federal income tax was created, we changed the
Constitution to impose a state income tax as well. It was placed in the
Constitution so it could not easily be repealed, but in doing so it also
enshrined it as a flat tax, even though the federal government later
adopted a graduated income tax on higher incomes. It has been something
of an obsession since then to make the Rich Pay More.
Five times since the 1960s, there have been attempts to change the flat
tax to a progressive one, but it has failed by a wide margin. So a new
strategy is being tried. Instead of a change in rates, a surcharge
mechanism will charge a 4 percent additional tax only on incomes over a
million. It resembles the Community Preservation Act property tax
surcharge. It is an additional tax on top of whatever the actual rate
is, and can only be spent on pre-approved categories of expense,
regardless of need or deficit in other areas, like snow plowing after a
major storm or an emergency reconstruction after a fire station burns
down.
This was only the first step in a longer process, and Fair Tax will make
the ballot in 2018 at the earliest. But remember to look at the roll
call now, to see if you agree with the legislator who will be
representing you then.
The Salem News
Thursday, May 19, 2016
Millionaires' tax proposal clears hurdle on Beacon Hill
By Christian M. Wade
Potholed roads, decaying bridges, a problem-plagued mass transit system
and an underfunded educational system are among the state's vast fiscal
woes, and advocates say new money is needed to fill the funding gaps.
A coalition of labor unions and community groups are rallying around a
controversial proposal to funnel more state revenue into education and
transportation by imposing an additional tax on the state's wealthiest
residents.
On Wednesday, state lawmakers took the first steps toward putting a
question on the November 2018 ballot that would impose an additional tax
of 4 percent on people with annual incomes of $1 million or more. The
extra revenue could only be spent on public schools and for repair and
maintenance of roads, bridges and public transportation.
In a vote that ran mostly along party lines, the House and Senate —
meeting together in a rare constitutional convention — voted to advance
the proposal by a 135-57 vote. At least 50 "yes" votes from the combined
200-member Legislature were required to pass it.
Lawmakers who support the measure said the state desperately needs to
come up with more tax revenue.
"We have an unsustainable tax system," said Rep. Jay Kaufman,
D-Lexington, a supporter of the amendment. "We are not able to raise the
money we need to fund fundamental services to the citizens of our cities
and towns."
"Nobody would argue that education and transportation are anything but
the primary responsibility of state and local government, and we have
reams of evidence that those two areas are woefully underfunded,"
Kaufman said.
Republican lawmakers — including Sen. Bruce Tarr, R-Gloucester, and Rep.
Brad Hill, R-Ipswich — tried unsuccessfully to lower the proposed rate
for the new tax to 3, 2 and even 1 percent through amendments to the
proposal. They also filed amendments to reduce the state's personal
income tax from 5.1 to 5 percent, which were also rejected.
Progressive Democrats, including Senate President Stanley Rosenberg,
D-Amherst, have for years pushed a graduated income tax, similar to the
federal system, in which low-income taxpayers pay at a lower rate than
those with larger incomes. The state's voters have rejected those
efforts five times, most recently in 1994.
"This is a tax on success ... Voters have rejected it time and time
again," Tarr said in a speech on the floor of the historic House
chamber, ahead of the vote. "This measure will send the message that in
Massachusetts if you achieve success the reward is a doubling of your
taxation. We're singling them out to pay for transportation and
education."
Tarr said the state needs to cut spending, not increase taxes, to pay
for education and transportation needs.
"We're engaging tax increase gymnastics," he said. "We have a spending
problem, not a revenue problem."
Supporters collected more than 157,000 signatures last year in an effort
to put the measure to the state’s voters.
To get on the ballot, the tax plan must pass a second vote by a newly
elected Legislature when it convenes next year and survive any possible
court challenges from opponents of the measure.
The state Constitution has been amended only 121 times since it was
ratified in 1780, according to the Secretary of State's office. Voters
most recently changed it in 2006, when they approved the state's health
care law.
In 2004, Senate and House lawmakers held a contentious constitutional
convention to debate same-sex marriage after the state Supreme Judicial
Court ruled that gays and lesbians should be allowed to marry in the
commonwealth.
That convention ended after lawmakers declined to vote on a proposal to
ban same-sex marriage.
Advocates of the tax proposal say they believe the issue is important
enough to galvanize lawmakers and voters.
Massachusetts needs another $1 billion a year in the next decade to
maintain and upgrade its deteriorating roads, according to a recent
state report. The state also must find a way to spend $684 million a
year for road maintenance, which includes annual operating costs, the
report found.
"Our roads are in terrible shape and we can't fix that with the existing
revenue stream," said Kristina Egan, director of Transportation for
Massachusetts, a coalition pushing for increased transportation funding.
"It's something we seriously need to deal with, and it makes sense to
get some more revenue from those who can afford to pay it."
Education advocates say the state shortchanges school districts by an
average of 11.5 percent – or about $500 million annually – due to a lack
of funding and the wealth-based formula that computes Chapter 70
education aid.
Proponents estimate that the tax proposal would drum up more than $2
billion a year in additional revenue.
Exactly how many households or individuals statewide would be affected
by the new tax isn't clear.
A recent "Wealth Report" by the Boston Business Journal found there were
hundreds of tax filers on the North Shore and in the Merrimack Valley
reporting at least $1 million in income in 2013, the most-recent tax
year available.
Andover topped the list in the region with 216 filers with income above
the $1 million mark, followed by Marblehead, which had 153. North
Andover had 104 and Beverly 91. Manchester-by-the-Sea boasted 85 filers
above $1 million.
Not surprisingly, Boston had one of the largest concentrations of
wealth, with 1,617 filers earning more than $1 million.
But the move to tax top-earners faces opposition from Republicans and
anti-tax groups, who are vowing to fight the ballot initiative.
The state's Republican Party blasted Wednesday's vote, saying the move
showed the Democrat-led Legislature is "ever at the ready" to hike
taxes.
"While Beacon Hill liberals employ lofty rhetoric, voters should see
today's vote for what it really is: another attempt to raise taxes on
every individual at every level to satisfy Democrats' unquenchable
thirst for spending," MassGOP Chairman Kirsten Hughes said in a
statement.
The fiscal watchdog group Citizens for Limited Taxation has
criticized the proposed constitutional amendment as a "millionaires'
tax" that will drive out the state's top earners and provide even less
tax revenue for state coffers.
"The multi–millionaires who have been providing hundreds of thousands in
state income tax revenue would then contribute ZERO," said Chip
Faulkner, the group's communications director. "It would kill the
golden goose."
WHERE THE MILLIONAIRES ARE
Hundreds of tax filers on the North Shore and in the Merrimack Valley
reported at least $1 million in income in 2013, the most-recent tax year
available.
Andover topped the list in the region with 216 filers with income above
the $1 million mark, followed by Marblehead, which had 153. North
Andover had 104, Beverly 91 and Manchester-by-the-Sea 85 filers above $1
million.
Boston had one of the largest concentrations of wealth, with 1,617
filers earning more than $1 million.
State House News Service
Thursday, May 19, 2016
As GOP rips income surtax, Baker hangs on to wait-and-see approach
By Matt Murphy
A day after House and Senate Republicans waged an unsuccessful fight
against advancing a proposed surtax on households with incomes above $1
million in Massachusetts, Gov. Charlie Baker declined to slam the door
shut on the possibility of him supporting the tax two years from now
when, presumably, he will be on the ballot running for re-election.
Baker has opposed any suggestion of raising taxes during his first
year-plus in office, and repeated on Tuesday that he's "not a big
believer" in higher taxes to pay for new state spending.
But when pressed during a radio interview on Thursday about how he might
vote should the tax proposal reach the ballot in 2018, Baker did not
take the same hard line expressed by other Beacon Hill Republicans who
have warned that the measure could be a jobs killer.
"I don't know. Let's see where we are when it gets there," Baker told
WGBH's Boston Public Radio host Jim Braude.
The House and Senate voted 135-57 on Wednesday in favor of advancing the
proposed constitutional amendment designed to generate $1.9 billion for
education and transportation by assessing a new 4 percent surtax on
households with incomes above $1 million.
A recent Boston Globe/Suffolk University poll also found enthusiasm for
the measure among voters, with 70 percent saying they would support the
amendment.
All but one of the 40 Republicans in the House and Senate voted against
advancing the question to the next legislative session in 2017-2018,
where it will again need at least 50 votes to be put before voters in
November 2018.
Baker, who refused during his last campaign for governor to sign a
no-new-taxes pledge, described himself Thursday as a "let the people
decide" guy, and acknowledged that he had, in fact, signed the tax
petition on the same radio show after Braude presented him with the
papers. Supporters of the tax on Wednesday repeatedly cited the
petition's 157,000 signers as demonstrative of support for the idea.
"We're still working our way through the process, obviously, on that
one, but I'm not a big believer in raising taxes on people in
Massachusetts. They've paid a lot more taxes on a lot of things over the
course of the last few years and I think it's incumbent on the
commonwealth to demonstrate that we can live within our means," Baker
said.
The governor pointed to the work of the MBTA Fiscal and Management
Control Board, which he said has proven in less than a year that it's
possible to "improve performance" and "save money at the same time."
The transit authority is dependent on significant assistance from the
state budget, where many accounts are being squeezed year after year, to
make fiscal ends meet.
The governor's reluctance to categorically reject the idea of taxing
income over $1 million at a higher rate than other income stands in
contrast to other Republicans who warned that the tax would send the
wrong message to the small business community and wealthy investors that
the state leans on to create jobs.
Senate Minority Leader Bruce Tarr of Gloucester called the proposed tax
on millionaires a "success penalty."
Republican Sen. Vinny deMacedo of Plymouth told the News Service this
week, "We like millionaires when they come and they build businesses and
they create jobs, however we've got to be mindful of the message that
tax policy sends."
Rep. Geoff Diehl, a Whitman Republican, told his colleagues during
debate Wednesday that "the real intent of this quote unquote
millionaire's tax is nothing more than a bait and switch. It's just a
way to open the door to higher income tax rates all levels. Once the tax
code becomes divided between two brackets, precedent will be set for
creating new brackets and making the code more and more progressive,
also hitting the middle class the hardest once high income earners move
themselves or their assets out of state."
Baker senior advisor Tim Buckley, calling to clarify the governor's
remarks, said Baker remains supportive of ballot referendums, but
reiterated, "The governor does not believe it's a good idea to raise
taxes on the people of Massachusetts, and we don't even know if we will
have this decision before voters."
Massachusetts Republican Party Chairwoman Kirsten Hughes blasted
Wednesday's vote of the Legislature as proof of Democrats' "unquenchable
thirst for spending," and pointed to Baker's efforts last year to close
a $1.8 billion deficit without raising taxes.
"Democrats in the Legislature should realize we can't tax our way to
prosperity," Hughes said.
Asked about the governor's comments on Thursday, party spokesman Terry
MacCormack stood behind Baker: "Governor Baker has been a strong
advocate for fiscal responsibility, balancing budget deficits without
raising taxes, and making state government more accountable and
efficient."
Baker famously refused to sign a pledge forswearing new taxes when he
ran successfully for governor in 2014 after taking the pledge four years
earlier.
At the time, he said, "I'm a reform before revenue guy and I'm going to
be the taxpayers' best friend on that whole question, but one of the
things that I learned with respect to the pledge is that if you take the
pledge you're basically signing up for the status quo."
Calling the tax code "extremely messy," Baker also said, "I would hate
to put myself in a position where if we actually came up with a way to
simplify and make the tax code more sensible and more business and
consumer and people friendly that somehow I would have a pledge in place
that would make it impossible for me to go ahead and execute on that."
Democrats who favor the tax say it would help rectify a "regressive" tax
system under which many low-income families pay a higher effective tax
rate than the wealthiest residents of the state. Tax supporters also say
education and transportation spending needs have been chronically
underfunded.
State House News Service
Thursday, May 19, 2016
Asked about constitutionality of surtax, Healey pivots to debate on
issue
By Colin A. Young
A day after House and Senate Republicans suggested the constitutional
amendment to impose a surtax on incomes over $1 million could be
unconstitutional, Attorney General Maura Healey was mum when asked about
the amendment's constitutionality.
During Wednesday's Constitutional Convention, Senate Minority Leader
Bruce Tarr raised concerns that the so-called millionaire's tax — which
adds a 4 percent surtax on personal income that exceeds $1 million and
dedicates that revenue to transportation and education initiatives —
violates the state's constitution.
"We know that the issue before us causes grave doubt as to
constitutionality because Article 48 provides the exclusive prerogative
to appropriate funding to the Legislature," Tarr said. "On one hand we
are told that this money will be used for exclusive purposes but on the
other hand money will only be spent ‘subject to appropriation,’ both of
these cannot be simultaneously true for the measure to meet
constitutional muster."
Asked Thursday morning about Tarr's concerns, the state's top prosecutor
dodged the question.
"When you're talking about education, when you're talking about
infrastructure, when you're talking about transportation needs, we have
needs right now in our state and I think it's important that we figure
out how we're going to support those efforts and fund those efforts,"
she said. "It's a good conversation, it's a good debate and discussion
and I think it's in the right direction for where we need to go given
what we need to do."
Asked again if she is satisfied that the question is constitutional, the
attorney general said, "We certified, as an office, this question for
the ballot and I know the debate will continue through the
Constitutional Convention this year and perhaps next year as well."
Healey's office, as part of the initiative petition process, reviews all
petitions to certify that they are legally eligible to appear on the
ballot.
State House News Service
Friday, May 20, 2016
Weekly Roundup - Whetting the appetite
Recap and analysis of the week in state government
By Matt Murphy
. . . So perhaps Gov. Charlie Baker had been infected with a bit of that
Weldian keep-'em-guessing spirit when he gently evaded a direct question
on the radio about whether he would vote against a proposed new surtax
on high income earners.
"I don't know," Baker said, after trying to reinforce that he's "not a
big believer in raising taxes." "Let's see where we are when it gets
there."
The governor was referring, of course, to the fact that the Legislature
this week took the first of two votes required to place on the 2018
ballot a proposed constitutional amendment designed to generate $1.9
billion for education and transportation by assessing a new 4 percent
surtax on households with incomes above $1 million.
House and Senate lawmakers voted 135-57 to pass the question to the
2017-2018 General Court when another vote of at least 50 lawmakers will
be required to put it on the ballot.
Republicans, who voted nearly unanimously against the measure, tried in
vain to make a case against the tax as an economy killer that would
drive wealthy business owners and investors, whom the state relies on to
create jobs, out of state.
Backers, led by Lexington Rep. Jay Kaufman, countered by calling the tax
on the wealthiest of the state an "elegant" mechanism to make the tax
system fairer and generate needed revenue for transportation and
education priorities.
For all the pronouncements from House Speaker Robert DeLeo and other
House Democrats about the "lack of appetite" on Beacon Hill, at least on
the House side, for new taxes, Senate Minority Bruce Tarr aptly pointed
out that it appeared the ballot amendment had served as something of an
"appetite stimulant."
Any effort to amend to the measure met with strong resistance from
leaders, both on the merits and a reticence to turn a citizens petition
into a legislative one, and thereby increase the threshold for
advancement from 50 to 100 votes.
Still, the GOP did manage to force votes on a number of proposals,
including the enshrinement of a 5 percent income tax in the
constitution, that could be used as fodder later this year on the
campaign trail.
For now, lawmakers can only imagine what a budget with an additional $2
billion to spend might look like. Reality at the moment demands living
within existing revenue streams, and for the Senate that meant a roughly
$39.5 billion budget proposal from its Ways and Means Committee that
looks not all that different from the budget produced by the House and
Senate.
The Senate's budget debate, with over 1,100 amendments to consider,
begins Tuesday morning. There are, of course, differences between the
House and Senate, including almost $30 million in additional spending on
higher education.
STORY OF THE WEEK: Lawmakers find it easier to say yes to higher
taxes when millionaires are footing the bill.
QUOTE OF THE WEEK: "Guess what? You can't trust us." - House
Minority Leader Brad Jones on whether voters should believe that revenue
from a "millionaire's tax" would be used to augment, rather than
supplant, current spending on transportation and education.
The Boston Herald
Sunday, May 22, 2016
Driving out the rich
Millionaire tax surcharge an end run to our wallets
By Howie Carr
Just how stupid have the voters of Massachusetts become?
That’s the question being asked in a new two-year statewide clinical
experiment now underway at the State House. The hackerama wants to find
out what will happen if they ask taxpayers to vote for income-tax hikes
— but only on “millionaires,” wink wink, nudge nudge.
It’s a grift that can only end one way, with everyone paying through the
roof. The endgame is so obvious that in five previous attempts the
non-working classes have tried to foist the “grad tax” on taxpayers,
they’ve been crushed — never by less than 64 percent of the votes.
But the hacks haven’t gone to the well since 1994, and of late the
wisdom of the electorate has been in a tailspin — Obama, Patrick,
Warren, Markey, Frank, etc., etc.
“Is it finally time?” the tax-fattened hyenas ask one another, “Have we
dumbed them ... just enough?” At least one poll indicates that if the
hacks give the voters the blade in 2018, they’ll gladly slit their own
throats.
Right now the state constitution mandates a flat income tax rate —
everyone pays at the same rate, just over 5 percent. The indolent have
long dreamed of a “progressive rate,” making people with more income pay
their “fair share.” So now they promote a “surcharge” on so-called
millionaires — 4 percent on incomes of over $1 million per year.
To change the state’s constitution, they need to prevail on the ballot
in 2018. They took the first step last week, winning a vote in a joint
session of the legislature, 135-57, to put this latest bait-and-switch
before the voters.
Not only do the hacks claim that they’ll “only” hit millionaires, they
also say the money will be “earmarked” for education and transportation.
Yeah, right. The attempt itself may even be unconstitutional. But who
cares, right?
The bigger problem is, soaking the rich never works. Look at New Jersey.
The hacks in Trenton have been trying to jack up the top marginal rate
from 8.97 percent to 10.75 percent.
C’mon down, David Tepper, a 58-year-old money manager worth $10.6
billion. Last October, he legally shifted his residence from New Jersey
to Miami Beach. Florida’s income tax rate is ... zero!
Then there was Maryland. They jacked up their top marginal rate and
31,000 “millionaires” instantly vanished.
The same thing will happen here. The state will quickly realize that the
supply of “millionaires” has failed. In order to deal with the
“shortfall,” the millionaire tax will have to be adjusted downward —
temporarily, of course — so that everyone making more than, say, $30,000
a year will be now designated for tax purposes as a millionaire. Look on
the bright side though, it’s for the children.
The debate in the Legislature last week broke along the usual lines.
These aren’t higher taxes, they’re “investments in the future.”
“Disparities” must be addressed. Transportation is “underfunded,” even
though Republicans pointed out that we already spend four times what New
Hampshire does to maintain our state highways — $685,000 per mile,
compared to $145,000 in the Granite State.
Obviously these Republicans have no compassion for the greedy — er, I
mean the needy.
The problem for the welfare-industrial complex is that no one believes
anything they say. In 2000, the voters approved cutting the state income
tax back to 5 percent in a 60-40 landslide — and the rate remains above
5 percent.
Rep. Jay Kaufman (D-Lexington) took umbrage to Republicans’ pointing out
that fact, saying, “We will be at 5 percent as the voters have asked
within two years.”
In other words, by Fiscal 2019. The Legislature will have given the
voters what they demanded ... in 2000 ... and they’re bragging about it.
“Following the will of the people,” asked Rep. Jim Lyons (R-Andover),
“is waiting 18 years to reduce the rate to what they voted 18 years
ago?”
And that’s just one of their lies. How about Bill Clinton’s promised
middle-class tax cut in 1992? Or Deval Patrick’s statewide property-tax
cut in 2006? Obama’s promise in 2009 of $2,500 annual savings on health
insurance under Obamacare? How about the tollbooths on the Mass Pike?
They were supposed to be torn down after the bonds sold to build I-90
were finally paid off — in 1988.
Right? Right? Right? Right?
On the other hand, the voters were smart enough to vote down the
automatic gas-tax increase in 2014, despite the fact that the hacks
outspent the working people 30-1. And Boston 2024, another raid on the
wallets of working people, went down in flames just last year.
Can working people dodge another bullet? I hope so, but I’m also
relieved I already own property in Florida.
|
|
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
BACK TO CLT
HOMEPAGE
|