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CLT UPDATE
Thursday, September 28, 2017
Still not taxed enough?
|
Frustrated by the condition of public
transportation infrastructure around the state, residents
from Boston to the Berkshires who were engaged by state
senators expressed interest in expanded rail and bus service
and a willingness to pay for it, according to a new report.
The MassMoves report, which was put together
by a group of senators who spent part of this year traveling
around Massachusetts to discuss priorities with voters, is
intended, according to Senate leaders, to spark a new
dialogue over how to improve transportation.
The exercise, the authors said, aimed to
develop a core set of values held by residents whether they
live on the North Shore or in Franklin Country. In the
report, senators did not propose specific projects, funding
sources or a blueprint for what to do next.
"I hope this isn't the end of it. I think
there still needs to be more public engagement and flushing
out more," Senate President Stanley Rosenberg told reporters
during a presentation of the report in his office....
The Amherst Democrat said he wasn't sure if
or when the work done by senators would lead to new
legislation, but noted that 16 senators had sent the survey
on Tuesday to their social media lists to solicit additional
public responses....
"Clearly people get the connection between
mobility and the economy and access to jobs, which is both
important for the economy and important for equity. They
believe in a system funded by everybody," said Jim Aloisi,
the former state transportation secretary who helped
facilitate the regional roundtables....
Rosenberg and McGee said if voters next
November approve a 4 percent surtax on income in excess of
$1 million and President Trump and Congress can agree on a
transportation stimulus package then Massachusetts may be
well on its way to its revenue goal. Both items would be
added to the money earmarked in a 2013 transportation
financing bill that McGee said has generated about $400
million a year in new money for infrastructure.
When the 2013 law was approved, its
supporters said it solved the longstanding financial
problems within the state’s transportation system and would
guarantee $805 million in new resources for transportation
system by fiscal 2018, including $500 million in new tax
revenue. At the time, House Speaker Robert DeLeo said he was
"confident that we now have the resources to fund a healthy
transportation system and build our economy."
While senators say the public favors new
transportation resources, voters in 2014 repealed a major
aspect of the 2013 law, a provision indexing the gas tax to
inflation....
Transportation for Massachusetts Director
Chris Dempsey attended all but one workshop - the session
for Greater Boston - and believes the report is an important
reminder that transportation issues need to be kept at the
forefront of Beacon Hill's policy agenda....
Dempsey said he hopes the conversation
started by the Senate will gain momentum, and in the
meantime the Legislature will give attention to bills (H
1640/S 1551) filed by Rep. Chris Walsh and Sen. Eric Lesser
that would allow cities and towns to band together and use
regional ballot questions to finance local infrastructure
projects.
State House News Service
Tuesday, September 26, 2017
Senate report asserts public dissatisfied with Mass.
transportation
Taxes in Massachusetts aren’t high. Compared
with the rest of the country, they’re pretty average. And
among New England states, only New Hampshire has a lower
overall tax rate....
To be clear, years ago Massachusetts really
was a high-tax state. Over time, however, limits on property
taxes and the big income tax reductions of 1998 through 2002
completely changed Massachusetts’ tax profile....
Focusing on income taxes is too narrow a
vantage, though, making it impossible to see the state and
local tax system as a whole. Yes, Massachusetts has a
relatively high income tax rate but it’s offset by low sales
taxes....
To give a sense of just how far
Massachusetts’ taxes have fallen, consider what would happen
if voters decide to pass the so-called millionaire’s tax.
That’s a major tax measure, designed to raise roughly $2
billion per year. But it would increase the overall tax rate
only to around 10.8 percent — still second-lowest in New
England, and 15th among US states.
In the end, though, this “how high are our
taxes” question is of secondary concern. More important is
whether we have found the right balance between the money we
raise with taxes and the programs we’ve decided to run via
state and municipal governments.
Here, the answer is a pretty emphatic no. A
decade of budget deficits suggests there’s a real and
persistent mismatch between tax revenues and spending
commitments.
How we decide to fix this imbalance — with
tax increases or spending cuts — may be one of the most
consequential political debates in the Commonwealth.
The Boston Globe
Monday, September 25, 2017
The data debunk the Taxachusetts myth
By Evan Horowitz
The state’s top retailer lobbying group has
decided to move forward with a ballot proposal that would
cut the sales tax from 6.25 percent to 5 percent and reserve
one weekend a year for tax-free sales in Massachusetts.
The Retailers Association of Massachusetts
had previously indicated that it would pursue putting a
proposal on the November 2018 ballot, but was not yet sure
whether it wanted to aim for a new sales tax of 5 percent or
4.5 percent.
The group said in a statement Thursday that
it had decided on 5 percent, which had been the rate until
2009. “There certainly was support to go lower, but there
also was a strong sentiment that a return to the previous
rate of 5 percent, where we’d been for decades… would be the
right approach to take and would ring true with voters,” RAM
Vice President Bill Rennie said....
The group now must collect more than 64,000
signatures in order for its proposal to appear on the ballot
next year. One of the 2018 Republican challengers to Sen.
Elizabeth Warren, state Rep. Geoff Diehl, has pledged to
help RAM collect the signatures....
Raise Up Massachusetts, the coalition of
labor, religious and community groups that is pushing the
other three ballot proposals, has also yet to take an
official position on the RAM measure, though its leaders
have told the Business Journal they’re concerned about the
drop in tax revenue it would cause.
Boston Business Journal
Thursday, September 21, 2017
Retailers to push for 5% sales tax, permanent tax holiday
State House News Service
Thursday, September 21, 2017
House Session
After a 12-minute session on Monday,
the House met for 11 minutes Thursday before gaveling out
for the weekend. The only bills on the move Thursday
pertained to local affairs in the towns of Harvard, Milford
and Barnstable and the boat excise tax in Chatham. After the
session, House Speaker Pro Tem. Patricia Haddad told the
News Service that next week's House plans would likely be
discussed during a House leadership meeting on Monday.
State House News Service
Monday, September 25, 2017
House Session
During a 10-minute session Monday morning,
the House amended and passed a home-rule bill to increase
the Boston Public Library board of trustees from nine
members to 15. The bill was filed by Rep. Byron Rushing,
himself a BPL trustee. The House also gave initial approval
to bills affecting affordable housing in East Boston and the
South End, and agreed to specifying a new alcohol license
for Junction Variety in the town of Palmer. The House
chaplain, Father Rick Walsh, prayed for the maintenance of
Fenway Park on the anniversary of its 1911 groundbreaking.
Adjourned until Wednesday.
State House News Service
Wednesday, September 27, 2017
House Session
With 58 votes in under two and a half
hours, the House restored $9.3 million in spending to
this year's budget. The House overrode 50 of Gov. Charlie
Baker's line-item vetoes and eight vetoes of outside
sections. The outside sections dealt with a childhood vision
commission, a child welfare reporting tax force and driver
school licenses. Before the votes, Ways and Means Chairman
Jeffrey Sanchez led the chamber in observing a moment of
silence for residents of Puerto Rico dealing with the
aftermath of hurricanes Irma and Maria. Local bills
affecting Palmer, Lakeville and Cambridge were enacted.
Two weeks after voting to reverse $275
million in budget vetoes issued by Gov. Charlie Baker, the
House appears primed for another round.
“(Wednesday) we’re going to be considering
more gubernatorial budget overrides, all of which are for
essential services or desirable services,” Rep. Jay Kaufman
said at a revenue committee hearing yesterday, the State
House News Service reported.
Taxpayers know, of course, that there is a
big difference between “essential” services and “desirable”
services....
Well, at least give Kaufman credit for
candor, appearing to acknowledge that some overrides are
happening simply because lawmakers find it “desirable.” ...
The Senate has yet to weigh in on the
overrides the House approved earlier this month. The revenue
picture hasn’t changed; tax collections through the first
two months of the fiscal year are still slightly behind
expectations.
This matters little to lawmakers who get to
dash off hometown press releases trumpeting their success in
securing state funds for this project or that, while leaving
it to the governor to deal with the mid-year fallout.
A Boston Herald editorial
Wednesday, September 27, 2017
No spending slowdown
House Democrats Wednesday voted to restore
$9.3 million in spending to this year's budget, whipping
through 58 overrides of Gov. Charlie Baker's budget vetoes
in just a couple hours in their second session since
returning from summer recess.
The overrides would pack money back into 50
accounts dealing with environmental protections, education,
homelessness assistance and other areas, and cleared the
House with minimal discussion a week after its members
restored $275 million in spending to the budget over Baker's
objections.
With Wednesday's votes, the House has now
overturned 112 of Baker's vetoes to line items -- restoring
a total $284 million of the $320 million he slashed from the
nearly $40 billion budget -- and eight of his nine policy
vetoes....
The Senate has not yet taken up any budget
vetoes, though senators could vote on overrides when they
meet Thursday for their first formal session in two months.
The overrides must pass both branches in order for the funds
to be put back into the budget.
State House News Service
Wednesday, September 27, 2017
Another day, another $9M voted to be restored by House to
state budget
|
|
Chip Ford's CLT
Commentary
On Wednesday The Boston Globe ran the State House News
Service report ("Senate report
asserts public dissatisfied with Mass. transportation")
with this headline: "Mass. residents — statewide — say
they’d pay for better transit."
[Transportation for
Massachusetts Director Chris] "Dempsey said he hopes the
conversation started by the Senate will gain momentum, and
in the meantime the Legislature will give attention to bills
(H 1640/S 1551) filed by Rep. Chris Walsh and Sen. Eric
Lesser that would allow cities and towns to band together
and use regional ballot questions to finance local
infrastructure projects."
What is
Transportation for Massachusetts? You won't be
surprised to discover it's another "progressive" group
larded with the usual cadre of special interest
tax-borrow-and-spend suspects.
The State House News Service reported:
"Clearly people get the connection between mobility
and the economy and access to jobs, which is both
important for the economy and important for equity.
They believe in a system funded by everybody," said
Jim Aloisi, the former state transportation
secretary who helped facilitate the regional
roundtables....
Aloisi said he was surprised to find that workshop
participants "slightly favored" broad-based taxes as
a means of financing transportation improvement over
user fees, such as tolls. Participants in the survey
also supported allowing cities and towns to raise
local revenues for transportation projects of their
choosing.
Rosenberg and McGee said if voters next November
approve a 4 percent surtax on income in excess of $1
million and President Trump and Congress can agree
on a transportation stimulus package then
Massachusetts may be well on its way to its revenue
goal. Both items would be added to the money
earmarked in a 2013 transportation financing bill
that McGee said has generated about $400 million a
year in new money for infrastructure.
When
the 2013 law was approved, its supporters said it
solved the longstanding financial problems within
the state’s transportation system and would
guarantee $805 million in new resources for
transportation system by fiscal 2018, including $500
million in new tax revenue. At the time, House
Speaker Robert DeLeo said he was "confident that we
now have the resources to fund a healthy
transportation system and build our economy."
While senators say the public favors new
transportation resources, voters in 2014 repealed a
major aspect of the 2013 law, a provision indexing
the gas tax to inflation.
It's interesting that allegedly "workshop participants"
— whoever they may be
— "slightly favored"
broad-based taxes (that everyone pays) over user fees (that
users of the service pay). More interesting, I find,
is that when an ever-increasing automatic "broad-based" tax
was imposed — specifically for
transportation — a majority of actual voters recently
rejected and repealed the automatic gas tax hike.
As always in Massachusetts, the state does not have a
revenue problem — it has a
spending problem. When it comes to transportation
infrastructure, Massachusetts has an astounding
spending problem.
According to a comprehensive report
issued last September by the Reason Foundation ("22nd
Annual Highway Report"), this state spends 320
percent more than the national average for every
mile of state road infrastructure built or maintained.
That puts this state at the 48th most expensive — spending
more per state-controlled mile than only Florida and New
Jersey.
|
Capital and Bridges Disbursements per
State-Controlled Mile |
|
Massachusetts |
$290,854 |
|
National Average |
$84,494 |
|
Maintenance Disbursements per State-Controlled
Mile |
|
Massachusetts |
$78,313 |
|
National Average |
$25,996 |
|
Administrative Disbursements per
State-Controlled Mile |
|
Massachusetts |
$74,924 |
|
National Average |
$10,051 |
|
Total Disbursements (including bond principal
and interest, etc.)
per State-Controlled Mile |
|
Massachusetts |
$675,939 |
|
National Average |
$160,997 |
|
Source:
Reason Foundation Policy Study No. 448,
September 2016, "22nd Annual Highway Report —
The Performance of State Highway Systems" [PDF] |
As we know, More Is Never Enough (MINE) and never will be
until they've taken it all from us. If they can't take
it all out of one of our pockets, then they'll try to nickel
and dime us from other directions:
Dempsey said he hopes the conversation started by
the Senate will gain momentum, and in the meantime
the Legislature will give attention to bills (H
1640/S
1551) filed by Rep. Chris Walsh and Sen. Eric
Lesser that would allow cities and towns to band
together and use regional ballot questions to
finance local infrastructure projects.
Rep. Walsh and Sen. Lesser in their bills propose: "Upon
passage of this Act, a city or town shall have authority to
impose any tax surcharge within its city or town on a single
subject of taxation including a payroll, sales, property,
fuel, or vehicle excise tax."
Do we taxpayers really need another level of
taxing authority? If passed and adopted this would
return us to pre-Proposition 2½ days —
only worse! Much worse. This isn't
the first time this idea has been proposed:
"Authorizing municipalities to levy a tax on income
would be precedent-setting in Massachusetts and open
a Pandora's Box of complexities and further
precedents." — Chip Ford, Executive Director
of Citizens for Limited Taxation, on a
Senate-approved proposal giving cities and towns an
option to levy a local payroll, sales, property or
vehicle excise tax to pay for local transportation
improvement costs including maintaining, repairing
and building roads, bridges and bikeways.
Beacon
Hill Roll Call
Sunday, July 17, 2016
Quotes of Note
We also adamantly oppose an
amendment to the municipal government reform bill
filed by Sen. Benjamin Downing (D-Pittsfield) which
would give communities an option to levy a local tax
to pay for local transportation costs.
CLT Memo to
the Legislature
Friday, July 29, 2016
No New Taxes!
I'd be remiss if I didn't comment on another
pro-Graduated Income Tax column by Evan Horowitz in the
Boston Globe. Where do I start?
He wrote:
To
be clear, years ago Massachusetts really was a
high-tax state. Over time, however, limits on
property taxes and the big income tax reductions of
1998 through 2002 completely changed Massachusetts’
tax profile....
"Over time"? They only happened because
Citizens for Limited Taxation put Proposition 2½
on the ballot in 1980, and the income tax rollback on the
ballot in 2000 — and a vast majority of voters agreed with
us both times that we were being taxed too much.
It had nothing to do with state government reining
itself in. We took our money back, period.
He wrote:
Focusing on income taxes is too narrow a vantage,
though, making it impossible to see the state and
local tax system as a whole. Yes, Massachusetts has
a relatively high income tax rate but it’s offset by
low sales taxes.
Massachusetts also has both a sales tax and
an income tax — and every other
tax mankind has ever conceived. The sales tax was
jacked up by 25 percent to 6.25% in 2009. The income
tax rate in 2009 stood at 5.3 percent but that still wasn't
enough. Only our rollback ballot question has gotten
it down to 5.1 percent after an additional 15 years
of waiting.
Why waste any more of our time on rebuttals of such
foolishness?
Since returning from their extended summer vacation, the
House over the past week has been in session for some three
whole hours — most of it spent
overriding the governor's budget vetoes
— and the Legislature continues
with its long weekends, easing back slowly into a work
routine. The Senate hasn't held a formal session since
July and remains M.I.A. but the senators will be back
eventually to do their share of veto overriding. They
sure are proving themselves to be, without doubt, "The Best
Legislature Money Can Buy."
The first order of business this time for those
legislators who have returned was at least not
another obscene pay grab — but
overrides of Gov. Baker's budget vetoes.
I explained how this budget process and subsequent
overrides work in Massachusetts last year in the CLT Update
of August 30, 2016 ("Budget
gap" has "easy fixes" for those honestly seeking them).
Every year it's the same dog-and-pony-show with the same
results. You can read my full commentary there, but
here's the most relevant truth from it:
This
is how budgeting works in the Legislature with a
Republican governor. The Legislature passes a
bloated budget that everyone recognizes is not
affordable. The governor vetoes as much of the
over-spending as he thinks he can get away with,
only to have his vetoes overridden by the Democrat
Legislature. Legislators run back to their districts
to crow about what a wonderful job they did bringing
home the bacon. They know they've overspent when
they send out their self-congratulatory press
releases, but most constituents won't until too
late, if at all. When and if the voters realize the
budget had to be cut, the Beacon Hill big-spenders
will blame the "heartless" governor.
Stay tuned. In the next day or two we'll provide
more information about the Retailers Association of
Massachusetts' signature drive for its sales tax cut ballot
question, that would also establish a date certain sales tax
holiday weekend. We'll tell you how you can
participate, can get a copy of the petition you'll be able
to print out, sign and circulate for more signatures.
|
 |
 |
|
Chip Ford
Executive Director |
|
|
|
|
State House News Service
Tuesday, September 26, 2017
Senate report asserts public dissatisfied with
Mass. transportation
By Matt Murphy
Frustrated by the condition of public
transportation infrastructure around the state,
residents from Boston to the Berkshires who were
engaged by state senators expressed interest in
expanded rail and bus service and a willingness
to pay for it, according to a new report.
The MassMoves report, which was put together by
a group of senators who spent part of this year
traveling around Massachusetts to discuss
priorities with voters, is intended, according
to Senate leaders, to spark a new dialogue over
how to improve transportation.
The exercise, the authors said, aimed to develop
a core set of values held by residents whether
they live on the North Shore or in Franklin
Country. In the report, senators did not propose
specific projects, funding sources or a
blueprint for what to do next.
"I hope this isn't the end of it. I think there
still needs to be more public engagement and
flushing out more," Senate President Stanley
Rosenberg told reporters during a presentation
of the report in his office. "There's plenty of
room for people to continue to participate in
this process and I hope that it will continue
and that we will come to grips with a plan and a
way of funding transportation to maintain and
grow our robust economy, helping people get to
where they need to go for all of the purposes
people leave their houses."
As the MBTA grapples with persistent service
problems, Massachusetts officials are slowly
moving forward with projects to extend the Green
Line to Somerville and Medford and bring
commuter rail service from Boston to Fall River
and New Bedford. Activists have pitched many
other projects, including an expansion of South
Station in Boston, a tunnel linking trains
between North and South stations and trains
connecting Springfield to Boston.
The Amherst Democrat said he wasn't sure if or
when the work done by senators would lead to new
legislation, but noted that 16 senators had sent
the survey on Tuesday to their social media
lists to solicit additional public responses.
"Not clear yet," Rosenberg said. "This is about
gathering the pubic opinion and visions and
trying to carry it forward and we don't have the
complete vision at this point. We don't have the
projects."
More than 80 percent of people who participated
in nine Senate workshops around the state
indicated they believe the transportation system
in Massachusetts is not in good shape, according
to the report, which surveyed 715 participants.
The participants broadly believed transportation
should be a higher priority for legislators on
Beacon Hill, and not only maintaining, but
expanding regional rail and bus service was seen
by those surveyed as the best option to more
easily move people.
"Clearly people get the connection between
mobility and the economy and access to jobs,
which is both important for the economy and
important for equity. They believe in a system
funded by everybody," said Jim Aloisi, the
former state transportation secretary who helped
facilitate the regional roundtables.
Sen. Thomas McGee, the co-chair of the
Transportation Committee, said he believes the
need could be as much as $1 billion a year in
needed new investment.
"The investment we need to make is not
happening," said the Lynn Democrat, who is
running for mayor of that North Shore city and
has been a proponent of expanded ferry service
and an extension of the MBTA's Blue Line to
Lynn.
Aloisi said he was surprised to find that
workshop participants "slightly favored"
broad-based taxes as a means of financing
transportation improvement over user fees, such
as tolls. Participants in the survey also
supported allowing cities and towns to raise
local revenues for transportation projects of
their choosing.
Rosenberg and McGee said if voters next November
approve a 4 percent surtax on income in excess
of $1 million and President Trump and Congress
can agree on a transportation stimulus package
then Massachusetts may be well on its way to its
revenue goal. Both items would be added to the
money earmarked in a 2013 transportation
financing bill that McGee said has generated
about $400 million a year in new money for
infrastructure.
When the 2013 law was approved, its supporters
said it solved the longstanding financial
problems within the state’s transportation
system and would guarantee $805 million in new
resources for transportation system by fiscal
2018, including $500 million in new tax revenue.
At the time, House Speaker Robert DeLeo said he
was "confident that we now have the resources to
fund a healthy transportation system and build
our economy."
While senators say the public favors new
transportation resources, voters in 2014
repealed a major aspect of the 2013 law, a
provision indexing the gas tax to inflation.
The Senate report was published hours after the
release a Massachusetts Taxpayers Foundation
report that also found significant problems in
the state's transportation system and called for
the formation of an independent commission to
conduct a full review.
Ninety-four percent of Senate workshop
participants said transportation needs to be a
higher priority for elected officials, and
Rosenberg said that legislators ought to pay
attention to that statistic despite the ongoing
work he sees happening at the State House around
transportation.
"There's plenty of room for people to continue
to participate in this process and I hope that
it will continue and that we will come to grips
with a plan and a way of funding transportation
to maintain and grow our robust economy, helping
get people to where they need to go for all of
he purposes people leave their houses," he said.
The conservative-leaning Pioneer Institute also
put out a study recommending expanded MBTA ferry
service as a cost-effective option to move
people in and out of Boston without adding
congestion on already crowded highways.
Rosenberg said he was happy to see the business
community engaging on the issue, and did not
rule out a third-party review that would be
reminiscent of the 2007 Transportation Financing
Commission.
"I certainly don't object to the idea, I just
think we need to get everybody around the same
table so we're not wasting resources and
duplicating effort and I think we need to have a
really focused process and discussion to
complete the work and it has to be honest and we
have to reckon with the costs and say how we're
going to pay for it, not just talk about what
we're going to build," he said.
The Legislature has a House-dominated Joint
Committee on Transportation, whose members are
charged with considering "all matters concerning
the development, operation, regulation and
control of all means of transportation in the
air, on land or in the water, the imposition of
tolls on tunnels or bridges and such other
matters as may be referred."
Transportation for Massachusetts Director Chris
Dempsey attended all but one workshop - the
session for Greater Boston - and believes the
report is an important reminder that
transportation issues need to be kept at the
forefront of Beacon Hill's policy agenda.
"One of the best reminders here is that U.S.
News and World Report ranked us the number one
state overall, but forty-fifth for transportion.
We have the healthiest, best educated workforce
in the country and we make that workforce sit in
traffic. That's no way to run an economy,"
Dempsey said.
Dempsey said he hopes the conversation started
by the Senate will gain momentum, and in the
meantime the Legislature will give attention to
bills (H 1640/S 1551) filed by Rep. Chris Walsh
and Sen. Eric Lesser that would allow cities and
towns to band together and use regional ballot
questions to finance local infrastructure
projects.
Rosenberg said the idea for the report came out
of a gathering of Senate presidents in Utah over
a year ago were he learned about the
transportation planning process that state went
through to grapple with its growing population.
Utah engaged half a million residents about
their preferences for infrastructure, he said,
which led to legislation and a ballot question
to enact the plan.
The Boston Globe
Monday, September 25, 2017
The data debunk the Taxachusetts myth
By Evan Horowitz
Taxes in Massachusetts aren’t high. Compared
with the rest of the country, they’re pretty
average. And among New England states, only New
Hampshire has a lower overall tax rate.
Says who? The Census Bureau, which regularly
releases details on taxes collected by state and
local governments. The latest batch covers 2015,
slightly stale but still largely accurate, given
that Massachusetts hasn’t pursued any recent tax
changes.
For every dollar people earned in Massachusetts,
about 10.4 cents went to state and local taxes —
in line with the national average of 10.3 cents.
There are 18 states with higher overall tax
rates, and 31 with lower rates.
To be clear, years ago Massachusetts really was
a high-tax state. Over time, however, limits on
property taxes and the big income tax reductions
of 1998 through 2002 completely changed
Massachusetts’ tax profile. Taxachusetts has now
been supplanted by Taxawii and Tax York.
Why does the old stereotype stick? Partly it’s
about the inertia of ideas. Outdated notions
often stay locked in our heads, long after
they’ve been disproved or debunked. (Anyone else
still think twice before swimming after a big
meal?)
There's another reason we can’t shake the
Taxachusetts slur. Overall, taxes aren’t high —
when you include things like property and sales
tax — but our income tax rate is. Sometimes,
that becomes the focus.
Focusing on income taxes is too narrow a
vantage, though, making it impossible to see the
state and local tax system as a whole. Yes,
Massachusetts has a relatively high income tax
rate but it’s offset by low sales taxes.
Elsewhere, you find the opposite. Nevada
residents have no income tax yet sales taxes are
so high that people end up paying about 10 cents
of every dollar — just like here.
To give a sense of just how far Massachusetts’
taxes have fallen, consider what would happen if
voters decide to pass the so-called
millionaire’s tax. That’s a major tax measure,
designed to raise roughly $2 billion per year.
But it would increase the overall tax rate only
to around 10.8 percent — still second-lowest in
New England, and 15th among US states.
In the end, though, this “how high are our
taxes” question is of secondary concern. More
important is whether we have found the right
balance between the money we raise with taxes
and the programs we’ve decided to run via state
and municipal governments.
Here, the answer is a pretty emphatic no. A
decade of budget deficits suggests there’s a
real and persistent mismatch between tax
revenues and spending commitments.
How we decide to fix this imbalance — with tax
increases or spending cuts — may be one of the
most consequential political debates in the
Commonwealth.
And it matters, for this debate, whether we
start from the assumption that we are already
living in Taxachusetts or trust the census data,
which say our state and local taxes are barely
above average.
Boston Business Journal
Thursday, September 21, 2017
Retailers to push for 5% sales tax, permanent
tax holiday
By Greg Ryan
The state’s top retailer lobbying group has
decided to move forward with a ballot proposal
that would cut the sales tax from 6.25 percent
to 5 percent and reserve one weekend a year for
tax-free sales in Massachusetts.
The Retailers Association of Massachusetts had
previously indicated that it would pursue
putting a proposal on the November 2018 ballot,
but was not yet sure whether it wanted to aim
for a new sales tax of 5 percent or 4.5 percent.
The group said in a statement Thursday that it
had decided on 5 percent, which had been the
rate until 2009. “There certainly was support to
go lower, but there also was a strong sentiment
that a return to the previous rate of 5 percent,
where we’d been for decades… would be the right
approach to take and would ring true with
voters,” RAM Vice President Bill Rennie said.
RAM had also been undecided about whether to
include a sales tax holiday requirement in the
ballot question. The group has argued for years
that the tax-free weekend is a big help to
Massachusetts brick-and-mortar retailers
battling online sales and year-round tax-free
shopping across the border in New Hampshire.
Its members elected to include the sales tax
holiday, RAM said. The proposal will direct the
state Department of Revenue to designate a sales
tax holiday weekend in August every year.
The group now must collect more than 64,000
signatures in order for its proposal to appear
on the ballot next year. One of the 2018
Republican challengers to Sen. Elizabeth Warren,
state Rep. Geoff Diehl, has pledged to help RAM
collect the signatures.
Three other potential ballot proposals for 2018
are opposed by many of the state’s major
business groups, including RAM: a surtax on
million-dollar earners, an increase in the
minimum wage to $15 an hour, and a requirement
that employers offer workers paid medical and
family leave.
Other business groups have yet to take a stance
on RAM’s proposed sales tax cut, including the
Associated Industries of Massachusetts, seen by
many as the most powerful lobbying group on
Beacon Hill.
AIM spokesman Chris Geehern has called it an
“interesting concept,” adding: “I think a
reduction in the sales tax is an interesting
counterbalance to the progressive questions that
may well end up on the ballot.”
Raise Up Massachusetts, the coalition of labor,
religious and community groups that is pushing
the other three ballot proposals, has also yet
to take an official position on the RAM measure,
though its leaders have told the Business
Journal they’re concerned about the drop in tax
revenue it would cause.
The Boston Herald
Wednesday, September 27, 2017
A Boston Herald editorial
No spending slowdown
Two weeks after voting to reverse $275 million
in budget vetoes issued by Gov. Charlie Baker,
the House appears primed for another round.
“(Wednesday) we’re going to be considering more
gubernatorial budget overrides, all of which are
for essential services or desirable services,”
Rep. Jay Kaufman said at a revenue committee
hearing yesterday, the State House News Service
reported.
Taxpayers know, of course, that there is a big
difference between “essential” services and
“desirable” services.
Preserving the former is much easier to justify
when revenues are trailing expectations, as they
were through the first two months of the current
fiscal year.
The latter?
Well, at least give Kaufman credit for candor,
appearing to acknowledge that some overrides are
happening simply because lawmakers find it
“desirable.”
That’s likely to include hundreds of earmarks in
the state’s tourism budget — the truest
definition of pork. We’re quite sure, for
example, that the two boxing programs in
Haverhill that are in line for $35,000 each in
taxpayer funds are just terrific. But how
exactly do they qualify as “tourism” programs
worthy of guaranteed state funding?
In fact, as we note every year, millions of
dollars are earmarked under the tourism banner
for municipal public works projects, local
festivals, gazebos and other frippery that fits
no one’s definition of “essential” state
services. But the House and Senate are expected
to easily override Baker’s veto of $6.8 million
in tourism spending.
The Senate has yet to weigh in on the overrides
the House approved earlier this month. The
revenue picture hasn’t changed; tax collections
through the first two months of the fiscal year
are still slightly behind expectations.
This matters little to lawmakers who get to dash
off hometown press releases trumpeting their
success in securing state funds for this project
or that, while leaving it to the governor to
deal with the mid-year fallout.
State House News Service
Wednesday, September 27, 2017
Another day, another $9M voted to be restored by
House to state budget
By Katie Lannan
House Democrats Wednesday voted to restore $9.3
million in spending to this year's budget,
whipping through 58 overrides of Gov. Charlie
Baker's budget vetoes in just a couple hours in
their second session since returning from summer
recess.
The overrides would pack money back into 50
accounts dealing with environmental protections,
education, homelessness assistance and other
areas, and cleared the House with minimal
discussion a week after its members restored
$275 million in spending to the budget over
Baker's objections.
With Wednesday's votes, the House has now
overturned 112 of Baker's vetoes to line items
-- restoring a total $284 million of the $320
million he slashed from the nearly $40 billion
budget -- and eight of his nine policy vetoes.
Rep. Brad Hill, an Ipswich Republican, was the
only lawmaker to rise to speak after the votes
began. About halfway through, he posed two
questions that went unanswered by the chamber's
Democratic supermajority: How much money they
had restored so far, and where do state revenue
collections stand nearly three months into
fiscal 2018?
"The first two months of this year, we were
reminded two weeks ago, we came in under
benchmark by quite a lot, and we have yet to see
the numbers for September," Hill said.
State tax revenues have fallen short of
expectations in recent years, leading to
mid-year budget cuts and constraints on spending
plans. July and August tax collections left the
state $11 million below benchmark at this point
in the fiscal year.
Halfway through September, the Department of
Revenue reported that tax collections were up
$181 million, or 13.9 percent from the same
period last year, but mid-month revenues are
often an inacurrate predictor of a full month's
returns.
House Ways and Means Chairman Jeffrey Sanchez
struck an optimistic note about the state's
revenue picture before the override votes began.
He called July and August "small months in terms
of tax collections" and said the mid-month
revenue report for September "shows the
potential for above-benchmark collections."
"At the same time we are cautious and we must be
mindful not to over-value mid-month reporting,
I'd like to acknowledge that this is an
indication that it is positive and Massachusetts
continues to have a strong and growing economy,"
Sanchez said.
The Senate has not yet taken up any budget
vetoes, though senators could vote on overrides
when they meet Thursday for their first formal
session in two months. The overrides must pass
both branches in order for the funds to be put
back into the budget.
Sanchez said the House was considering restoring
spending for programs with "overarching impacts"
before "more targeted initiatives." He
highlighted recovery schools, emergency food
assistance and adult basic education -- all
programs where vetoes were succesfully
overridden Wednesday -- as programs that affect
people's lives.
"It's important to remind everyone that these
aren't just dollar amounts to be considered in
the abstract," the Jamaica Plain Democrat said.
"These programs and services make a real impact
in all of our constituents' and communities'
life on a daily basis."
Wednesday's overrides ranged in size from the
$10,000 for Inspector General Glenn Cunha's
office to $1.1 million for the state's recovery
high schools, according to numbers from
Sanchez's office. Eighteen of the votes restored
sums of less than $100,000.
The overrides with the most support -- each
passing with 146 in favor and eight Republicans
voting against -- were $35,000 for the National
Guard and $50,000 for the Municipal Police
Training Committee.
The policy sections House lawmakers signed off
on returning to the budget dealt with driver's
education licenses, a Child Welfare Data
Reporting Task Force, and a Childhood Vision and
Eye Health Commission. |
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