|
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 |
Barbara Anderson's Great Moments |
Follow CLT on Twitter |
CLT UPDATE
Saturday, July 1, 2017
It's full circle again
|
The Baker administration's gambit to force
some internet retailers to begin collecting sales taxes from
Massachusetts shoppers has hit a major snag after Revenue
Commissioner Michael Heffernan on Wednesday rescinded the
directive that would have allowed the state to begin
collecting taxes on July 1.
The administration has not abandoned the
proposal, but will instead go through the regulatory
process, which can be a more time consuming and public
exercise that will prevent the state from immediately
accessing a revenue stream that Baker and legislators hoped
would generate $30 million for the fiscal 2018 budget, which
is due by this weekend.
Heffernan rescinded the directive just days
before the rule was set to take effect after a hearing in
Suffolk Superior Court on Wednesday where two online
retailers were challenging the process the Department of
Revenue used to develop the policy....
Baker proposed back in January as part of
his annual budget to begin collecting a sales tax - 6.25
percent - from online retailers that do more than $500,000
in sales and 100 transactions in the Bay State annually.
The administration said at the time that the
change could be made without legislation, but NetChoice and
the American Catalog Mailers Association filed a lawsuit
challenging the directive. After a hearing in Suffolk
Superior Court on Wednesday where the plaintiffs were
seeking an injunction to block sales tax collections from
beginning on July 1, Heffernan rescinded the directive
before the judge could rule.
That lawsuit has now been withdrawn, but
NetChoice Executive Director Steve DelBianco said the
e-commerce trade association will not hesitate to refile the
lawsuit if the administration does not relent on the policy.
State House News Service
Thursday, June 29, 2017
Online retailers celebrate as revenue chief rescinds tax
directive
It surely pained them to do it, since it
blew a $30 million hole in next year’s already out-of-whack
budget, but the Baker administration yesterday backed off a
plan to begin collecting sales taxes from more internet
retailers selling goods in Massachusetts. In light of a
pending legal challenge, however, the procedural move was
the only one that made sense.
For years there has been tremendous pressure
from brick-and-mortar outlets in the Bay State, who argue
that on-line sellers who aren’t required to collect and
remit state sales taxes put them at a competitive
disadvantage. As part of his fiscal 2018 budget plan Gov.
Charlie Baker had announced a new policy, establishing a new
sales threshold that would trigger required payments from
online sellers....
But Baker still plans to pursue the new tax
scheme by regulation, rather than by fiat. The plaintiffs
promise that when he does, they’ll head straight back to
court.
For now the bottom line is that the state
treasury next year may be $30 million lighter — and the bad
news just keeps coming.
A Boston Herald editorial
Friday, June 30, 2017
More taxing budget news
The Retailers Association of Massachusetts
on Thursday waded deeper into its exploration of a possible
ballot question in 2018 to lower the state's sales tax,
releasing an online survey intended to test the appetite of
Bay State merchants for a campaign that could begin almost
immediately....
A sales tax reduction ballot question would
potentially more than reverse the sales tax increase that
House Speaker Robert DeLeo helped lead in 2009, when the
rate was raised from 5 to 6.25 percent. As more sales are
conducted tax-free online, retailers have grown frustrated,
warning elected officials that communities anchored by
stores and shops are at risk and pleading with Beacon Hill
each year for tax relief provided by a brief sales tax
holiday....
The choices presented to the RAM members in
the survey include leaving the sales tax rate alone,
lowering it to 5 percent, to 4.5 percent, to 4 percent,
lower than 4 percent or a total repeal that would put
Massachusetts on par with neighboring New Hampshire....
One factor in RAM's calculation about
whether to pursue a sales tax cut at the ballot will be the
fact that voters, barring a successful legal challenge, will
also be asked in 2018 to decide whether taxpayers should pay
a 4 percent surtax on all income over $1 million.
State House News Service
Thursday, June 29, 2017
Retailers intensify work on possible sales tax cut ballot
question
Negotiators are trying to finish work on a
consensus fiscal 2018 budget Thursday night and taxpayers
will learn about the depth of revenue markdowns and
corresponding budget changes when a deal is done, the Senate
budget chief told the News Service Thursday.
"They'll know when we finalize the budget,
when we have all the numbers final," Senate Ways and Means
Committee Chair Karen Spilka told the News Service.
Spilka's comments came after senators late
Thursday afternoon huddled privately, apparently talking
about the prospects of a budget deal and an agreement on
legislation reworking the voter law legalizing recreational
marijuana....
The Legislature and Gov. Charlie Baker are
in a budget bind, having worked all year on spending plans
predicated on a 3.9 percent increase in tax revenues only to
see actual revenues slump, trickling in at a 1.4 percent
growth rate for fiscal 2017.
Now a six-member conference committee, which
is meeting privately, is charged with dealing with the issue
but neither lawmakers nor Baker are saying much about the
size of the revenue problem, solutions to it, or how changes
they are making might affect taxpayers and government
programs and services.
State House News Service
Thursday, June 29, 2017
Spilka: "We're hoping to have a budget tomorrow"
There’s now considerable talk that conferees
won’t complete that task in time; indeed, both chambers have
passed a one-month budget for July to prepare for that
eventuality. That wouldn’t be a catastrophe — “one-12ths,”
as they are known, have certainly been pressed into service
before — but neither is the budgetary deadline the only one
that looms....
If the Legislature had completed lots of
other work so far this year, some delay on these two issues
might not matter much. But legislatively, this has been
anything but a productive spring. Tellingly, one of the few
pieces of legislation that has moved smartly along was the
big raise for the speaker and Senate president and their
legion of leadership lieutenants....
Legislative leaders should fight the
tendency to postpone action to the last moment, whether
those deadlines come at mid-year or the end of the session.
A properly paced, well-orchestrated, productive legislative
schedule is the kind of thing the public has every right to
expect of two leaders pulling down the handsome pay that
DeLeo and Rosenberg now earn.
A Boston Globe editorial
Wednesday, June 28, 2018
Some urgency, please, on Beacon Hill
If the liberals in the Massachusetts
Legislature believe in battling income inequality, they
would quickly raise the minimum wage to $15 an hour.
And to convince doubters of their sincerity
-- as well as to lead by example -- these progressive
legislators on Beacon Hill should agree to include
themselves in the pay hike bill.
After all, who knows more about voting for
pay raises, especially for themselves, than members of the
Democrat-controlled House and Senate? Nobody, that's who....
Just like minimum-wage workers, legislators
could put themselves on the clock, punching in and out,
verifying the hours they spent at the Statehouse, including
time and a half for overtime.
They could begin working eight hours a day,
five days a week, just like most people do. They could then
take two weeks off for summer vacation, like the rest of the
common folk, instead of whole summers, and then some....
The pending wage legislation, which raises
the minimum wage from $11 to $15 an hour, is supported by
Raise Up Massachusetts, a coalition of minimum-wage workers,
and it is strongly backed by Senate President Stan
Rosenberg, who has never worked outside of the Statehouse,
as well as other Beacon Hill progressives.
And while the inclusion of legislators in
the bill would represent a pay cut, and not a pay raise, for
the 160 members of the House and the 40 members of the
Senate, $15 an hour would be more appropriate for the work
they do and the time they spend on that work....
Of course, in the fight for a $15 minimum
wage and income equality, there are sacrifices to be made.
But that is what public service is all about, or so the
politicians keep telling us....
If progressives truly believe in fighting
for the working poor, it is only fair that everybody gets
$15 an hour, including them. Right?
The Lowell Sun
Friday, June 23, 2017
What the state really needs: a $15-an-hour legislator
By Peter Lucas
State legislators voted themselves a 40
percent pay raise earlier this year with little debate, yet
they won't consider a two-day sales-tax holiday in August
for the working stiffs of Massachusetts.
It's mean-spirited.
Massachusetts should have a permanent
two-day sales-tax holiday each and every August.
Democrats, who control the Legislature,
should gladly reward Main Street businesses and working
families for their contributions to this ever-expanding
entitlement state. Instead, they've abandoned them -- and
it's becoming an alarming pattern.
This represents the second year in a row the
Legislature won't approve sales-tax relief....
Truly, this two-day event sparks economic
activity in many communities where customers shop and save a
little bit. It costs the state roughly $26 million in tax
revenue. That amounts to a minuscule 0.00065 percent of the
state's bloated $40 billion annual budget.
Put another way, it's nearly the same amount
of money the Legislature added to the state budget in
January through their pay-raise scheme -- $30 million.
Back then, they weren't thinking about
budget deficits, even though fiscal watchdogs -- and this
newspaper -- where sounding alarms on declining revenue
collections....
Where is the legislators' sacrifice?
They set an irresponsible $40 billion budget
a year ago, spent like drunken sailors, gave themselves an
astronomical pay raise, and now are telling mom-and-pop shop
owners and workers to take a hike.
This isn't JFK's Democratic Party -- not by
a long shot.
In fact, revenue-hungry Democrats aren't
reducing costs for fiscal 2018, they're planning new taxes
on millionaires and pot smokers to spend more. When does it
end -- or at least slow down?
A Lowell Sun editorial
Sunday, June 25, 2017
Restore sales-tax holiday in August
That two-day sales tax holiday, beloved by
retailers and consumers alike, may become an endangered
species — and at a time when brick and mortar stores need
all the help they can get.
The tax holiday got left on the budget
cutting room floor last year as the Legislature scrounged
for every available dollar it could wring from taxpayers.
The Revenue Department estimated that the 2015 tax holiday
“cost” the state’s coffers about $25 million....
Hypocrisy is such an ugly thing.
A Boston Herald editorial
Sunday, June 25, 2017
A ‘holiday’ to cheer for
Earlier this month, in a joint session of
the Massachusetts House and Senate, the graduated income
tax, also known as the “Millionaire Tax,” was voted to be
sent to the November 2018 state ballot. Due to the many
concerns that I had, I voted against this economic proposal.
Some of my concerns surrounded the issues of there being no
safeguard to ensure the collected revenue will be allocated
to increased support for education and transportation as
intended. Additionally, it will hurt our small-business
economy resulting in job loss. Not only that, it scares
potential employers from relocating to Massachusetts. And
lastly, the tax flight theory demonstrates the increased
out-of-state migration due to the implementation of a
graduated income tax....
The state constitution explicitly prohibits
any amendment that “makes a specific appropriation of
money.” However, the proposal attempts to circumvent this
limitation by designating the money collected as “subject to
appropriation” by the Legislature. Therefore, any and all
collected revenue will be placed in the general fund, where
its allocation is at the Legislature’s discretion.
During last year’s Constitutional
Convention, the House Republican Caucus tried unsuccessfully
to amend the proposal to ensure that any funds raised
through the surtax would be used “in addition to” rather
than “in lieu of” money currently spent on education and
transportation, however, because the ballot proposal was not
subject to further amendment this year, I expressed my
concern that there are no safeguards in place to certify
that the funds are appropriately being allocated to
education and funding.
In other words, the funds collected could be
used to replace existing revenues spent in those areas,
resulting in no net spending increase on transportation or
education. A comparable situation was the national tobacco
settlement money: in lieu of spending the money exclusively
on smoking cessation and health-related programs, only a
portion of it was spent on those areas....
Historically, graduated income tax ballot
proposals have failed in Massachusetts. Between 1962 and
1994, Massachusetts voters rejected five of these ballot
initiatives, and the most recent in 1994 was defeated by a
margin of more than 2-1. Come November, I urge you to
consider all of the facts when considering the graduated
income tax ballot question and demonstrate the same wisdom
as we have in the past.
The Salem News
Monday, June 26, 2017
'Millionaire Tax' would hurt Massachusetts' economy
By Rep. Brad Hill
|
|
Chip Ford's CLT
Commentary
I've been waiting all week for something to happen on Beacon
Hill that's worthy of passing on in an update. I'm
still waiting, as inconsequential events, but
interesting to us who want to stay informed, accumulate.
They need to be passed on to you, eventually. This
update is pretty much a "week in review" of little momentary
importance — dots yet to be
connected, but the connections beginning to form.Though
there's been news and commentary about the goings on up on
Beacon Hill, or not, very little if anything has changed
over the past week. It's more like things were being
regurgitated as the clock ran out. Time ran out last
night. Today, July 1, marks the first day of the
state's new fiscal year, but still there is no
budget. As the Boston Globe editorial observed on
Wednesday:
If the
Legislature had completed lots of other work so far this
year, some delay on these two issues might not matter
much. But legislatively, this has been anything but a
productive spring. Tellingly, one of the few pieces of
legislation that has moved smartly along was the big
raise for the speaker and Senate president and their
legion of leadership lieutenants.
At least "The Best Legislature Money Can Buy" has proven
that it can recognize and set priorities
— but we've always known
that anything which personally benefits legislators comes
ahead of all else, and it gets done "smartly." There
were lots of snarky comments in the media over the past week
targeting the Legislature's obscene pay grab, so it appears
we're not the only ones who aren't going to forget!
While I'm connecting dots, here's an historically
relevant few to keep in mind as we're assaulted with the
sixth graduated income tax ballot question.
The organization that's pushing for the graduated income
tax is the same cabal of liberals who have been behind every
past attempt to pick taxpayers' pockets or deprive them of
tax relief. Raise Up Massachusetts evolved from the
dissolution of TEAM, the Tax Equity Alliance for
Massachusetts, or as we long ago more aptly branded them,
"Tax Everything And More."
In a December 1, 2002 article in CommonWealth Magazine, "TEAM
finds a less taxing name" writer Michael Jonas noted:
Formed in 1987 as a liberal
counterweight to Citizens for Limited Taxation,
the Tax Equity Alliance for Massachusetts has made the
case for public spending and progressive taxation with
the same zeal its foes have brought to their anti-tax
crusades. But after 15 years in the tax-battle mosh pit,
TEAM is getting a makeover. Shedding its name
–
and well-known acronym – for a wonkier moniker, the
organization
–
formerly known as TEAM
–
has recast itself as the Massachusetts Budget and Policy
Center.
Leaders of the group say the
name change simply brings the title in line with the
work. “Over the last several years we’ve expanded to
work on far more issues than just taxes or just tax
equity,” says executive director James St. George. The
organization’s recent research reports include an
examination of growing income disparities between the
state’s top and bottom wage earners and an analysis of
state budget growth in the 1990s.
The new Massachusetts Budget and Policy Center is part
of a network of liberal-leaning groups in 23 states
receiving funding from the Ford Foundation, the Charles
Stewart Mott Foundation, and the Annie E. Casey
Foundation to produce budget and tax analyses with a
particular focus on low-income and other vulnerable
groups. (TEAM will still exist, on paper at least,
handling more direct political and lobbying work, but is
not expected to consume much of the four-person staff’s
time.)
Citizens for Limited Taxation executive director
Barbara Anderson, who says the TEAM acronym
should have stood for “tax everything and more,” sees
the name change as an effort to camouflage the group’s
left-wing image. “I think they’re trying to get away
from TEAM because people aren’t into liberals anymore,”
says Anderson.
Jim St. George was the first executive director of the
Mass. Budget and Policy Center (MBPC),
replaced by Noah Berger in 2003. The Takers Cabal
flowed with the name change, the
same cast of characters and the
same deep pockets. As a tax-exempt 501(c)3
organization, MBPC had to keep up at least a semblance of
being non-political and non-partisan —
its purpose purely "educational."
Thus when activism for ballot questions was required, in
2013
Raise Up Massachusetts was born, The Takers' army of
political ground troops funded by the same, overlapping
legion of deep-pockets benefactors. The Takers'
longtime spokesman is Steve Crawford. Representing the
taxpayers' side, I've debated him over the years at a number
of forums. Crawford has been at the forefront of
whatever incarnation The Takers assume on any number of tax
issues over the decades, and he's here again for this
go-around.
It's full circle again. I don't know how many times
we've had to do something dramatic to stop government or
turn it around — then had to
come back a few years later and do it all over again.
I cut my political activist teeth running the campaign to
repeal the state's mandatory seat belt law on the 1986
ballot, Even back then as a rookie I knew they wouldn't take
NO for an answer and would be back. In 1992 it was
passed again, and we put it back on the ballot.
We did term limits petition drives, twice, finally made
it to the ballot and won only to have the court throw out
the vote. We've done repeals of legislative pay raises
at least twice. We had to do two ballot question
signature drives and one ballot campaign to roll back the
"temporary" income tax in 2000 —
and we're still debating it. CLT was founded in
1976 to oppose and defeat that year's graduated income tax,
and we defeated it again in 1994.
It looks like we've lived long enough to begin Round
Three of all these issues —
because The Takers never take NO for an answer.
But they're just after "the millionaires" this time they
promise, and won't come back to pick off the rest of us
later.
If anyone buys that —
then hey, I've got some nice swampland down in the
Everglades you might be interested in, and I'll even throw
in a bridge to it . . .
|
 |
 |
|
Chip Ford
Executive Director |
|
|
|
|
State House News Service
Thursday, June 29, 2017
Online retailers celebrate as revenue chief
rescinds tax directive
By Matt Murphy
The Baker administration's gambit to force some
internet retailers to begin collecting sales
taxes from Massachusetts shoppers has hit a
major snag after Revenue Commissioner Michael
Heffernan on Wednesday rescinded the directive
that would have allowed the state to begin
collecting taxes on July 1.
The administration has not abandoned the
proposal, but will instead go through the
regulatory process, which can be a more time
consuming and public exercise that will prevent
the state from immediately accessing a revenue
stream that Baker and legislators hoped would
generate $30 million for the fiscal 2018 budget,
which is due by this weekend.
Heffernan rescinded the directive just days
before the rule was set to take effect after a
hearing in Suffolk Superior Court on Wednesday
where two online retailers were challenging the
process the Department of Revenue used to
develop the policy.
The decision to back off the directive was made
in consultation with Attorney General Maura
Healey, officials said, but it may not be enough
to stop a legal challenge.
A DOR official said the regulation will look
very similar to the directive issued in April,
and the administration hopes it can be finalized
and put into effect by the fall. The impact on
revenue estimates from the delay in online sales
tax collections is not yet known, an official
said.
Baker proposed back in January as part of his
annual budget to begin collecting a sales tax -
6.25 percent - from online retailers that do
more than $500,000 in sales and 100 transactions
in the Bay State annually.
The administration said at the time that the
change could be made without legislation, but
NetChoice and the American Catalog Mailers
Association filed a lawsuit challenging the
directive. After a hearing in Suffolk Superior
Court on Wednesday where the plaintiffs were
seeking an injunction to block sales tax
collections from beginning on July 1, Heffernan
rescinded the directive before the judge could
rule.
That lawsuit has now been withdrawn, but
NetChoice Executive Director Steve DelBianco
said the e-commerce trade association will not
hesitate to refile the lawsuit if the
administration does not relent on the policy.
"I'm surprised to learn that the state plans to
go right back to a policy that clearly violates
the Permanent Internet Tax Freedom Act and
longstanding legal precedent and if they do come
back to this approach we will refile our lawsuit
and look forward to another winning day in
court," DelBianco told the News Service on
Thursday.
Just a day earlier, NetChoice had issued a
celebratory statement, calling the decision by
Heffernan to rescind the directive an action
that would "greatly benefit Massachusetts
consumers as well as Bay State small businesses
looking to sell across the country."
"We hope that other states take notice of
today's decision by Commissioner Heffernan and
follow his lead," he said.
Officials at the Department of Revenue, however,
said their legal interpretation for online sales
collection remains the same, and the regulation
sought will closely mirror the rescinded
directive.
At issue is whether the state can force an
online retailer to collect and remit sales taxes
on purchases made by consumers in Massachusetts
if the retailer does not have a physical
presence in Massachusetts.
A longstanding legal precedent established by
the Supreme Court has often been interpreted to
prevent states from forcing the collection of
sales taxes from sellers without a physical
nexus in their state, but the Baker
administration's rule argued that smartphone and
computer applications downloaded by customers,
cookies maintained on computers by retailers to
customize the online shopping experience, and
vendor and delivery networks that service
customers in-state are enough to establish a
physical presence.
DelBianco strong disagrees: "I don't see how any
court will agree that electrons flowing into a
computer or smartphone comes anywhere near a
physical presence," he said.
Some major online retailers, including Amazon,
already do collect sales taxes from
Massachusetts customers.
A six-member House-Senate conference committee
currently negotiating a fiscal 2018 budget for
the year that starts July 1 is already expected
to adjust revenue projections downward based on
slow tax growth over the past several months,
and change could further alter their
calculations.
The Boston Herald
Friday, June 30, 2017
A Boston Herald editorial
More taxing budget news
It surely pained them to do it, since it blew a
$30 million hole in next year’s already
out-of-whack budget, but the Baker
administration yesterday backed off a plan to
begin collecting sales taxes from more internet
retailers selling goods in Massachusetts. In
light of a pending legal challenge, however, the
procedural move was the only one that made
sense.
For years there has been tremendous pressure
from brick-and-mortar outlets in the Bay State,
who argue that on-line sellers who aren’t
required to collect and remit state sales taxes
put them at a competitive disadvantage. As part
of his fiscal 2018 budget plan Gov. Charlie
Baker had announced a new policy, establishing a
new sales threshold that would trigger required
payments from online sellers.
But groups representing on-line retailers argue
that a Supreme Court ruling shields them from
having to collect and remit state sales taxes
unless they have a physical presence in the
state. So they challenged Baker’s directive in
court.
Of course the big guys (namely, Amazon) have
already begun collecting sales tax from
Massachusetts customers, so this effort to
spread the burden more evenly seemed inevitable.
Baker’s policy would have ensnared only those
who sell in high volume — at least $500,000, and
100 transactions in Massachusetts annually — so
the Kansas mom who sells trinkets on Etsy won’t
become a slave to the state Department of
Revenue.
Revenue Commissioner Michael Heffernan rescinded
the new directive after a hearing on the lawsuit
this week, State House News Service reported,
and the suit was then withdrawn. But Baker still
plans to pursue the new tax scheme by
regulation, rather than by fiat. The plaintiffs
promise that when he does, they’ll head straight
back to court.
For now the bottom line is that the state
treasury next year may be $30 million lighter —
and the bad news just keeps coming.
State House News Service
Thursday, June 29, 2017
Retailers intensify work on possible sales tax
cut ballot question
By Matt Murphy
The Retailers Association of Massachusetts on
Thursday waded deeper into its exploration of a
possible ballot question in 2018 to lower the
state's sales tax, releasing an online survey
intended to test the appetite of Bay State
merchants for a campaign that could begin almost
immediately.
The board of the retailers association has
authorized its staff to conduct member, legal
and voter research and "engage in opinion leader
discussions" about the possibility of pursuing a
ballot initiative.
And they'll have to act fast. Aug. 2 is the
deadline for petitioners to submit language and
at least 10 signatures from registered voters to
the attorney general for review for possible
placement of initiative petitions on the 2018
ballot.
The Retailers Association of Massachusetts board
voted just before Memorial Day to ramp up its
vetting process, which will include a member
survey as well as additional public polling,
according to RAM President Jon Hurst.
"They're getting more serious, but wanted us to
do more due diligence," Hurst told the News
Service Thursday afternoon.
A sales tax reduction ballot question would
potentially more than reverse the sales tax
increase that House Speaker Robert DeLeo helped
lead in 2009, when the rate was raised from 5 to
6.25 percent. As more sales are conducted
tax-free online, retailers have grown
frustrated, warning elected officials that
communities anchored by stores and shops are at
risk and pleading with Beacon Hill each year for
tax relief provided by a brief sales tax
holiday.
The survey put into the field on Thursday and
reviewed by the News Service seeks to gauge the
level of interest among retailers in a sales tax
reductions, measure the impact of competition
from online sellers and solicit feedback on what
a new sales tax rate should be.
It also asks association members how much money
they might be willing to contribute to a
campaign to lower the sales tax, which would
likely be fought by online retailers and
interest groups worried about a loss in state
revenue impacting other types of services.
The choices presented to the RAM members in the
survey include leaving the sales tax rate alone,
lowering it to 5 percent, to 4.5 percent, to 4
percent, lower than 4 percent or a total repeal
that would put Massachusetts on par with
neighboring New Hampshire.
"I think we are really trying to figure out what
do our members feel like they need in order to
recover sales from these non-taxed competitors.
There's a lot of anger here," Hurst said.
The more aggressive testing of the waters on a
ballot question comes after Revenue Commissioner
Michael Heffernan on Wednesday revoked a
directive that would have required online
retailers that do at least $500,000 in sales in
Massachusetts annually to collect and remit the
state sales tax starting July 1.
Bay State brick-and-mortar sellers have for
years complained about being on unequal footing
with out-of-state and online-only retailers who
peddle their wares via smartphones and
computers, but legal precedent requiring stores
to have physical presence in a state before
government can require sales tax collections has
so far proved an insurmountable hurdle.
The Baker administration still believes it has
legal standing to go after online sales taxes,
but will now pursue the change through a
lengthier regulatory process in the face of
threats from online sellers of a lawsuit.
"Even if the reg works, it's going to trigger
more litigation that's going to take years, up
to the Supreme Court. There's a whole lot of
frustration about whether Beacon Hill and other
opinion leaders are really serious about saving
Main Street and saving retailer jobs and having
fairness for consumers," Hurst said.
One factor in RAM's calculation about whether to
pursue a sales tax cut at the ballot will be the
fact that voters, barring a successful legal
challenge, will also be asked in 2018 to decide
whether taxpayers should pay a 4 percent surtax
on all income over $1 million.
Hurst noted that the collision of the two
questions on the ballot could resurrect a debate
started in 2013 by former Gov. Deval Patrick
when the Democrat proposed a comprehensive tax
code overhaul that included an increase in the
income tax to 6.25 percent and decrease in the
sales tax to 4.5 percent.
Patrick argued that the recalibration of the tax
code would result in a more progressive system
that didn't disproportionately fall on
low-income families, but the proposal went
nowhere in the Legislature.
"Maybe it's time that we really revisit more
seriously such a tax reform," Hurst
RAM said in its member survey that consumer
spending accounts for 70 percent of the
Massachusetts economy, and yet competition from
online retailers and neighbor states like New
Hampshire, where there is no sales tax, drives
sales away from Massachusetts businesses.
Hurst said a decision on whether to submit an
initial petition likely will come "within the
week before" the Aug. 2 deadline to submit
signatures.
A MassINC Polling Group survey of voters
released this week found 62 percent support for
a hypothetical ballot question to lower the
sales tax from 6.25 percent to 4.5 percent.
A poll commissioned by RAM in November found
that 79 percent of those respondents said they
support reducing the sales tax to about 4
percent or 4.5 percent to make the tax system
fairer and to support local retailers. In the
same poll, 66 percent said they believe the
"proper sales tax range" for Massachusetts would
between 4 percent and 4.5 percent.
Gov. Charlie Baker in 2010 supported rolling the
state sales tax rate back to 5 percent, but when
asked in March about a potential 2018 ballot
question he said, "That one has a long way to go
before it ends up coming before the voters and
if it does, obviously, we'll talk about it then,
but I did support back in 2010 the idea of
reducing the sales tax from 6.25 to five and
there's no question that retailers in
Massachusetts face tremendous competition and
pressure from our colleagues north of the border
who don't have a sales tax at all."
State House News Service
Thursday, June 29, 2017
Spilka: "We're hoping to have a budget tomorrow"
By Michael P. Norton
Negotiators are trying to finish work on a
consensus fiscal 2018 budget Thursday night and
taxpayers will learn about the depth of revenue
markdowns and corresponding budget changes when
a deal is done, the Senate budget chief told the
News Service Thursday.
"They'll know when we finalize the budget, when
we have all the numbers final," Senate Ways and
Means Committee Chair Karen Spilka told the News
Service.
Spilka's comments came after senators late
Thursday afternoon huddled privately, apparently
talking about the prospects of a budget deal and
an agreement on legislation reworking the voter
law legalizing recreational marijuana.
Facing a self-imposed June 30 deadline on the
marijuana bill and aware that the new fiscal
year begins on July 1, lawmakers are discussing
the potential for a weekend session, but no one
late Thursday afternoon knew for sure when work
would be completed on either bill.
"We're working hard on it. We're trying to get
it finished," Spilka said. She added, "We're
hoping to have a budget tomorrow, we'll see."
Asked if budget negotiators would finish their
work Thursday night, Spilka said, "I don't have
a crystal ball. I don't know. We're working. We
hope to get it finished by tonight."
The Legislature and Gov. Charlie Baker are in a
budget bind, having worked all year on spending
plans predicated on a 3.9 percent increase in
tax revenues only to see actual revenues slump,
trickling in at a 1.4 percent growth rate for
fiscal 2017.
Now a six-member conference committee, which is
meeting privately, is charged with dealing with
the issue but neither lawmakers nor Baker are
saying much about the size of the revenue
problem, solutions to it, or how changes they
are making might affect taxpayers and government
programs and services.
"They're making great progress and there has
been no slowdown in communications," Senate
President Stan Rosenberg said, referring to
budget negotiators.
Rosenberg said even he hasn't learned about a
fiscal 2018 tax revenue figure that negotiators
may be using to overhaul their spending plans.
Asked if there been an agreement on a new
revenue figure, Rosenberg said, "No. I haven't
gotten a specific number. I know there is
continuing conversation back and forth. I think
they're trying to work with Secretary Lepore as
well."
Senate President Pro Tempore Marc Pacheco
(D-Taunton) said senators were advised that they
would be notified of any breakthroughs in budget
and marijuana bill negotiations. Asked if there
was optimism or pessimism about reaching deal,
Pacheco said, "Neither."
"We're just waiting for conference committee
action," he said. "We're still open for
tomorrow, Saturday, Monday or sometime after the
Fourth depending on what the situation happens
to be."
Said Rosenberg, "We will meet as soon as we can
to try to get both of those to the governor's
desk, but until the conference reports are filed
we can't plan the actual time."
Asked about the marijuana conference committee,
Rosenberg said, "They've resolved a huge amount
of material. So it's going very well."
"Absolutely no comments," said Sen. Will
Brownsberger, one of the six marijuana bill
conferees, said twice when asked first about the
topic and then about whether a deal would be
reached Thursday night.
Both branches were holding their sessions open
early Thursday evening, with legislative leaders
apparently waiting to learn whether deals on the
budget and marijuana bills would be filed prior
to 8 p.m. in order for them to be considered
under legislative rules during potential
sessions on Friday.
"The conference committee reports would have to
be filed by 8 o'clock tonight, realistically,
for us to debate tomorrow," said Sen. Jamie
Eldridge.
—Colin Young
contributed reporting
The Boston Globe
Wednesday, June 28, 2018
A Boston Globe editorial
Some urgency, please, on Beacon Hill
Important deadlines are just days away on Beacon
Hill — and the Legislature needs to get its act
in gear to meet them.
One is the deadline for delivering a new budget.
Fiscal year 2018 starts on July 1, which means
the new budget is due on Friday. In the face of
revenue growth running at only about 1.2 percent
so far this year, a budget conference committee
is struggling to reduce spending plans
originally based on projected growth of 3.9
percent.
There’s now considerable talk that conferees
won’t complete that task in time; indeed, both
chambers have passed a one-month budget for July
to prepare for that eventuality. That wouldn’t
be a catastrophe — “one-12ths,” as they are
known, have certainly been pressed into service
before — but neither is the budgetary deadline
the only one that looms.
A second is the self-declared deadline for
getting an agreement on the Legislature’s
overhaul of the marijuana-legalization ballot
law. The legislative rewrite effort started late
and moved slowly, with the two chambers only
passing their competing plans last week. On
Monday, the conference committee began meeting
behind closed doors to hammer out a compromise.
Will it be done by week’s end? Neither House
Speaker Robert DeLeo nor Senate President
Stanley Rosenberg were offering any ironclad
assurances.
“That is the goal,” noted the speaker.
If the Legislature had completed lots of other
work so far this year, some delay on these two
issues might not matter much. But legislatively,
this has been anything but a productive spring.
Tellingly, one of the few pieces of legislation
that has moved smartly along was the big raise
for the speaker and Senate president and their
legion of leadership lieutenants.
Queried about what it would say if the
Legislature can’t bring its deadline work to
fruition in a timely way, both DeLeo and
Rosenberg sidestepped.
“Ask that question again next week, because
Friday is the end of the month, and that’s our
goal, to get those done,” replied Rosenberg.
“I think that if you are talking about what we
have accomplished . . . I think you ought to
wait not only for the week, but I think you
ought to take a look at the legislative session
ahead, and then we’ll take a look in terms of
what we have done in terms of . . . our full
legislative session,” responded DeLeo.
It’s certainly possible that this will wind up
being a productive year. Still, in the recent
past — specifically, 2015 — a languid pace,
particularly in the DeLeo’s top-down, tightly
controlled House, found many important bills
piled up at session’s end, with a lot left
hanging and undone.
Legislative leaders should fight the tendency to
postpone action to the last moment, whether
those deadlines come at mid-year or the end of
the session. A properly paced,
well-orchestrated, productive legislative
schedule is the kind of thing the public has
every right to expect of two leaders pulling
down the handsome pay that DeLeo and Rosenberg
now earn.
The Lowell Sun
Friday, June 23, 2017
What the state really needs: a $15-an-hour
legislator
By Peter Lucas
If the liberals in the Massachusetts Legislature
believe in battling income inequality, they
would quickly raise the minimum wage to $15 an
hour.
And to convince doubters of their sincerity --
as well as to lead by example -- these
progressive legislators on Beacon Hill should
agree to include themselves in the pay hike
bill.
After all, who knows more about voting for pay
raises, especially for themselves, than members
of the Democrat-controlled House and Senate?
Nobody, that's who.
In addition, nothing would be more equal than to
pay members of the Legislature the same minimum
hourly wage as many of the people they
represent. By including themselves in the bill,
they would display a solidarity with the working
class that politicians so often talk about, you
know, the people who work at McDonald's or Papa
Gino's, or in nursing homes and health care
facilities.
Just like minimum-wage workers, legislators
could put themselves on the clock, punching in
and out, verifying the hours they spent at the
Statehouse, including time and a half for
overtime.
They could begin working eight hours a day, five
days a week, just like most people do. They
could then take two weeks off for summer
vacation, like the rest of the common folk,
instead of whole summers, and then some.
It is true that legislators are often meeting
with constituents in their districts when not at
the Statehouse.
This is called being in the district, which is
legislative code for missing in action. On those
occasions, an honor system (trust but verify) on
hours worked in the district could be put in
place.
The pending wage legislation, which raises the
minimum wage from $11 to $15 an hour, is
supported by Raise Up Massachusetts, a coalition
of minimum-wage workers, and it is strongly
backed by Senate President Stan Rosenberg, who
has never worked outside of the Statehouse, as
well as other Beacon Hill progressives.
And while the inclusion of legislators in the
bill would represent a pay cut, and not a pay
raise, for the 160 members of the House and the
40 members of the Senate, $15 an hour would be
more appropriate for the work they do and the
time they spend on that work.
It would also go a long way toward addressing
the problem of income inequality because
fast-food workers would be paid the same as
fast-talking legislators.
Except for the speaker of the House and the
Senate president, along with a handful of
committee chairs, the job of a legislator is
essentially a part-time job, even though members
have offices and full-time staffers who deal
with constituents.
Legislators may work hard at committee meetings,
public hearings or while the Legislature is in
session, the fact of the matter is that it is
not in session very often. It meets only for a
day or two during the week and takes the summer
off.
The Legislature then comes back into session in
January when the weather gets cold.
So the job for most legislators is part time,
but with full-time pay, of course.
For instance, the salary of the average
legislator in $62,547, not counting $10,000 to
$15,000 in office and travel expenses.
The sum is deceiving, however, because there are
stipends that go to legislators who hold
leadership positions, which includes almost
everybody.
Thus, committee chairs get up to an extra
$30,000 on top of a base pay of $62,547. There
is also extra pay for vice chairs of committees,
as well as for majority and minority leaders,
assistant majority and minority leaders,
assistants to the assistants, and just about
everyone else who walks through the door, except
maybe the doorkeeper.
Of course, in the fight for a $15 minimum wage
and income equality, there are sacrifices to be
made. But that is what public service is all
about, or so the politicians keep telling us.
The sacrifice legislators would make at $15 an
hour is to see their base pay of $62,547 a year
be reduced $31,200, provided they put in a whole
day's work for a full week, which is what
minimum-wage workers do.
As things now stand, the Legislature is
prohibited from raising its own pay. The salary
is tied to the state's median household income
and is reviewed every two years. That is why the
latest round of pay hikes was disguised as
"stipends," and not pay raises.
To solve the problem, and to fight income
inequality, the Legislature could tie its pay to
the minimum wage.
If progressives truly believe in fighting for
the working poor, it is only fair that everybody
gets $15 an hour, including them. Right?
The Lowell Sun
Sunday, June 25, 2017
A Lowell Sun editorial
Restore sales-tax holiday in August
State legislators voted themselves a 40 percent
pay raise earlier this year with little debate,
yet they won't consider a two-day sales-tax
holiday in August for the working stiffs of
Massachusetts.
It's mean-spirited.
Massachusetts should have a permanent two-day
sales-tax holiday each and every August.
Democrats, who control the Legislature, should
gladly reward Main Street businesses and working
families for their contributions to this
ever-expanding entitlement state. Instead,
they've abandoned them -- and it's becoming an
alarming pattern.
This represents the second year in a row the
Legislature won't approve sales-tax relief.
Truly, this two-day event sparks economic
activity in many communities where customers
shop and save a little bit. It costs the state
roughly $26 million in tax revenue. That amounts
to a minuscule 0.00065 percent of the state's
bloated $40 billion annual budget.
Put another way, it's nearly the same amount of
money the Legislature added to the state budget
in January through their pay-raise scheme -- $30
million.
Back then, they weren't thinking about budget
deficits, even though fiscal watchdogs -- and
this newspaper -- where sounding alarms on
declining revenue collections.
The budget deficit has mushroomed ever since,
with little reduction in spending. With five
days to go in fiscal year, the state is facing a
$600 million gap.
It is this deficit that Democrats are pinning
their arguments on for banning a sales-tax
holiday.
We can't afford it, they say.
The grunts have to sacrifice -- for the best
interest of the state -- they say.
Where is the legislators' sacrifice?
They set an irresponsible $40 billion budget a
year ago, spent like drunken sailors, gave
themselves an astronomical pay raise, and now
are telling mom-and-pop shop owners and workers
to take a hike.
This isn't JFK's Democratic Party -- not by a
long shot.
In fact, revenue-hungry Democrats aren't
reducing costs for fiscal 2018, they're planning
new taxes on millionaires and pot smokers to
spend more. When does it end -- or at least slow
down?
Brick-and-mortar Main Street businesses employ
local people and make positive contributions to
communities. They deserve a break -- even a
brief one -- from battling Internet companies
that, in many cases, don't pay state taxes.
A sales-tax holiday in August is also an
inducement for consumers, especially parents
shopping for their kids' return to school.
There's no excuse for legislators to become such
tightwads when their legislative largess
seemingly has no bounds.
Restore the sales-tax holiday in August and make
it a permanent event.
The Boston Herald
Sunday, June 25, 2017
A Boston Herald editorial
A ‘holiday’ to cheer for
That two-day sales tax holiday, beloved by
retailers and consumers alike, may become an
endangered species — and at a time when brick
and mortar stores need all the help they can
get.
The tax holiday got left on the budget cutting
room floor last year as the Legislature
scrounged for every available dollar it could
wring from taxpayers. The Revenue Department
estimated that the 2015 tax holiday “cost” the
state’s coffers about $25 million. Of course,
that doesn’t take into account how many people
opted to buy that back-to-school computer here
instead of New Hampshire because of the tax
break.
The two day tax holiday — usually a weekend in
mid-August — comes at a time when school
supplies and electronics are on shoppers’ lists.
Furniture, too, is a hot item.
Some lawmakers are clearly on board. House
Minority Leader Brad Jones has filed a bill to
establish a permanent holiday.
Rep. Paul McMurtry (D-Dedham) told a Revenue
Committee hearing this past week, “I look at
this as a gesture of appreciation to the small
businesses in the commonwealth. I think we can’t
afford not to do it.”
But then, of course, there are folks like Sen.
Michael Brady (D-Brockton), co-chair of the
Revenue Committee.
“We are very concerned about revenue and not
having enough revenue in the commonwealth, so
we’re weighing every option,” Brady said.
This is the same lawmaker who just last month
went on a rant at a State House rally organized
by union officials to protest outsourcing at the
MBTA. Yes, Brady was actually railing *against*
efforts aimed at saving money at the T (which is
in part funded by a portion of the sales tax).
But he gets the vapors at the thought of giving
taxpayers a two-day break — in a $40 billion
budget.
Hypocrisy is such an ugly thing.
The Salem News
Monday, June 26, 2017
'Millionaire Tax' would hurt Massachusetts'
economy
By Brad Hill
Earlier this month, in a joint session of the
Massachusetts House and Senate, the graduated
income tax, also known as the “Millionaire Tax,”
was voted to be sent to the November 2018 state
ballot. Due to the many concerns that I had, I
voted against this economic proposal. Some of my
concerns surrounded the issues of there being no
safeguard to ensure the collected revenue will
be allocated to increased support for education
and transportation as intended. Additionally, it
will hurt our small-business economy resulting
in job loss. Not only that, it scares potential
employers from relocating to Massachusetts. And
lastly, the tax flight theory demonstrates the
increased out-of-state migration due to the
implementation of a graduated income tax.
Currently, Massachusetts assesses residents’
personal income uniformly at a “flat tax” rate
of 5.1 percent, and short-term capital gains at
12 percent. This proposal would amend the state
constitution, creating a two-tier tax system
that imposes an additional 4 percent surtax on
all income in excess of $1 million, effective
Jan. 1, 2019, and the revenues would be
“allotted” to transportation and education
funding. The state constitution explicitly
prohibits any amendment that “makes a specific
appropriation of money.” However, the proposal
attempts to circumvent this limitation by
designating the money collected as “subject to
appropriation” by the Legislature. Therefore,
any and all collected revenue will be placed in
the general fund, where its allocation is at the
Legislature’s discretion.
During last year’s Constitutional Convention,
the House Republican Caucus tried unsuccessfully
to amend the proposal to ensure that any funds
raised through the surtax would be used “in
addition to” rather than “in lieu of” money
currently spent on education and transportation,
however, because the ballot proposal was not
subject to further amendment this year, I
expressed my concern that there are no
safeguards in place to certify that the funds
are appropriately being allocated to education
and funding.
In other words, the funds collected could be
used to replace existing revenues spent in those
areas, resulting in no net spending increase on
transportation or education. A comparable
situation was the national tobacco settlement
money: in lieu of spending the money exclusively
on smoking cessation and health-related
programs, only a portion of it was spent on
those areas.
Many prominent business groups consider the tax
proposal to be anticompetitive, indicating that
its impact on small businesses and job creation
would be detrimental. Despite the populist label
of the Millionaire Tax, the main reason to
oppose this bill is that it could harm our
economy by waging class warfare on our small
businesses and job providers, which is a war we
all lose. Furthermore, the Massachusetts High
Technology Council warned against it, stating
that it “could cause irreparable harm to the
state’s innovation economy.” Major business
groups, such as the Massachusetts Taxpayers
Foundation, Associated Industries of
Massachusetts and the Massachusetts Competitive
Partnership, are now considering legal action.
It is entirely possible that the full $1.9
billion in projected tax revenue will never be
accrued. For example, in 2013, Massachusetts
implemented a tax hike on the sale of
cigarettes, increasing their sale from $2.51 to
$3.51 per pack in the hopes of increasing state
revenue. Unfortunately, this sales tax failed
miserably, and we instead saw a drastic increase
in illegal smuggling of cigarettes into the
state, as well as an increase in residents
driving over the border into New Hampshire to
purchase their cigarettes rather than purchase
them in-state, and consequently lost out on the
projected revenue. Researchers at the Mackinac
Center for Public Policy hypothesized that the
increase in sales tax on cigarettes led to the
drastic spike of illegally purchased cigarettes
in Massachusetts, as the percent of cigarettes
brought illegally into the state rose from 12
percent in 2013 to 29.3 percent in 2014 after
the tax had been implemented.
In response to increases in a state’s average
income tax rate, many of the state’s top earners
will likely relocate to avoid the new surtax on
their income, thus eliminating the primary
source of the proposed surtax-generated funding.
The state of New Jersey experienced this
phenomenon in 2003. According to 2012 findings
by the New Jersey Department of the Treasury,
the state accumulated a net loss of
approximately 18,000 to 28,000 taxpayers who
relocated, and suffered an annual income loss of
between $2.2 billion and 2.4 billion between
2003 and 2010. New Hampshire Governor Sununu
must be licking his chops hoping for us to pass
this ballot measure.
Additionally, there is concern of the volatility
of capital gains taxes, which are, under the
graduated income tax proposal, depended on to
provide about $500 million of the new tax
revenues. The Massachusetts Taxpayers Foundation
noted that in 2002, capital gains tax
collections dropped by $670 million and by a
whopping $1.65 billion during the recession in
2008. Issues associated with tax hikes are not
partisan, and Democratic Gov. Dannel Malloy of
Connecticut said it best: “I’ve raised taxes
multiple times. It’s not working. And it’s come
up a cropper … Spurring economic growth is
what’s necessary.”
Historically, graduated income tax ballot
proposals have failed in Massachusetts. Between
1962 and 1994, Massachusetts voters rejected
five of these ballot initiatives, and the most
recent in 1994 was defeated by a margin of more
than 2-1. Come November, I urge you to consider
all of the facts when considering the graduated
income tax ballot question and demonstrate the
same wisdom as we have in the past.
Brad Hill, R-Ipswich is the state
representative for the 4th Essex District, which
is comprised of Hamilton, Ipswich, Manchester,
Rowley, Topsfield and Wenham. |
| |
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
|