 |
Post Office Box 1147
▪
Marblehead, Massachusetts 01945
▪ (781) 639-9709
“Every Tax is a Pay Cut ... A Tax Cut is a Pay Raise”
47 years as “The Voice of Massachusetts Taxpayers”
— and
their Institutional Memory — |
|
CLT UPDATE
Monday, November 29,2021
State's
Multi-Billions Jackpot Creates Problems
Jump directly
to CLT's Commentary on the News
|
Most Relevant News
Excerpts
(Full news reports follow Commentary)
|
|
Anyone who drives a car
or consumes anything delivered by a truck has an
extra something to be thankful for this
Thanksgiving, and that something is the Boston
Herald. The Herald’s work editorializing against the
regressive carbon gas tax scheme known as the
Transportation and Climate Initiative and vigorously
reporting on its faults over the last two and half
years was critical to the scheme’s demise earlier
last week. Without the local media coverage provided
by the Herald, residents would have been hard
pressed to find any accurate information on the
potential 12-state scheme. Other Boston-based media
outlets refused to cover the negative economic
impacts and only covered the idealistic and virtuous
aspects of TCI....
The Massachusetts
Fiscal Alliance was laser-focused on stopping the
scheme before it could start. We took a lot of heat
for being the loudest voice against the
environmental lobby and Gov. Baker, but our efforts
to resist the scheme in Massachusetts and organize
others to do the same in the other 12 states paid
off. Oftentimes, our work involved pointing people
in the direction of the great work being done at the
Herald and I am sure they felt similar pressure as
they continually reported on the truth of the issue.
The Boston Herald news reporters were often the only
ones asking Gov. Charlie Baker any hard questions
about the TCI scheme and for that, they should be
commended. Along with Boston Herald columnist Howie
Carr, the Boston Herald consistently delivered to
its readers important information about the scheme.
Others in the coalition
should be applauded as well. This includes Chip
Ford at Citizens for Limited Taxation,
the Beacon Hill Institute, the Committee to Stop the
TCI Tax, the bipartisan group of petitioners who
sought to bring the TCI repeal forward as a ballot
question in 2022, Chris Carlozzi at the National
Federation of Independent Business, MassGOP Chairman
Jim Lyons and everyone else who worked so hard to
stop this manipulative tax scheme. Without them, TCI
would still be moving forward.
Massachusetts is the
birthplace of the Thanksgiving Day holiday and
motorists across the mid-Atlantic and New England
can now be thankful that we are also not the
birthplace of the TCI gas tax scheme. We hope they
remember that this is due to the hard work of a lot
of people, with a special thanks to the staff and
reporters at the Boston Herald for speaking truth to
power for the benefit of the everyday people of our
great commonwealth.
Happy Thanksgiving,
Massachusetts!
The
Boston Herald
Thursday, November 25, 2021
Kudos to Herald for shedding light
on faults with TCI scheme
By Paul Diego Craney
The Democratic-led
Massachusetts Legislature is now officially a
national embarrassment.
Lawmakers — who are
still able to work remotely because the State House
is closed to the public — are on a seven-week
holiday break while billions in federal COVID relief
funds sit there unspent.
So legislators get to
enjoy Thanksgiving and Christmas from home, playing
by their own rules while the rest of us struggle to
meet our work demands while stressing out over the
holidays.
And even when they come
back from break, Democratic leaders make sure they
do as little work as possible....
Massachusetts is one of
the only states in the country that hasn’t opened up
the historic State House to the public, citing the
continued threat of the coronavirus.
And Democratic leaders
refuse to release the names of five state reps who
haven’t been vaccinated, which doesn’t seem to be in
the public interest. And you can’t file a public
records request to find out the names of those reps
because the Legislature is exempted from the public
records laws....
It’s the height of
arrogance....
It underscores the
question: do we really need a full-time paid
Legislature?
Why are taxpayers
funding a Legislature that won’t come back to work —
even at the cost of delaying the spending of
billions in federal relief money? ...
The Legislature can
still meet in “informal sessions” through the
holiday but that won’t happen because a single
lawmaker can block any votes.
All this should strike
fear in the hearts of voters. Can you imagine how
much worse this would be if Democrats also
controlled the governor’s office?
The
Boston Herald
Monday, November 22, 2021
Foot-dragging Massachusetts
Legislature continues to be national embarrassment
By Joe Battenfeld
Massachusetts has
nearly $5 billion in unspent federal stimulus
dollars to spread to its residents. At least another
$8 billion in aid is coming from the US government
to help repair roads, bolster public transit, and
shore up the state against climate change. The
state’s tax receipts are again running well ahead of
expectations.
This is good news for
Massachusetts. But the heady fiscal times could also
complicate a question that voters are set to answer
in the November 2022 election: Should Massachusetts
raise taxes on its wealthiest residents to generate
billions more for the state to spend?
A proposed
constitutional amendment that would layer a
surcharge on yearly earnings above $1 million will
land on the ballot in 2022, years after it first
surfaced during a time of mounting needs for
Massachusetts’ school and transportation systems —
and of financial uncertainty for the state.
The yawning shortfalls
and prospective billion-dollar budget gaps of
several years ago, however, have been replaced by an
unexpected budget surplus, a state emergency savings
account that’s surged to a record $4.6 billion, and
multibillion-dollar buckets of federal aid that
lawmakers say can bring “generational change” to
Massachusetts....
“It’s a totally
different landscape about the need to raise revenue
and what the revenue is for,” said Evan Horowitz,
executive director of the Center for State Policy
Analysis at Tufts University, which studies state
ballot questions. “In the short term, it has
weakened the argument for any kind of immediate tax
increase. The state is not desperately looking for
money. What I don’t know is if it fundamentally
changes the long-term issues” the revenue could be
used to address....
Through October,
Massachusetts had collected $723 million more in tax
revenues than it was expecting through those four
months of the fiscal year, a trend that Alan
Clayton-Matthews, an economist and Northeastern
University professor emeritus, said sets the state
up to “most certainly” see a surplus by the end of
June.
“Those who don’t want
to pay for it are going to use what we’re dealing
with at the moment and make an argument, ‘Gee whiz,
the Fair Share Amendment really isn’t needed now,’ ”
said Representative James J. O’Day, who sponsored
the amendment.
“I get a little annoyed
when people say, ‘Oh my goodness, we have money
today.’ This is a short-term fix,” the West Boylston
Democrat said of federal aid. “The Fair Share
Amendment isn’t a sprint. It’s not a one-time deal,
not a two-time deal. It’s annually. That can only be
a benefit to our families, to our communities, to
our businesses, to infrastructure.”
But opponents say the
current big pots of money shouldn’t be ignored at
the ballot box, even if it’s not the only reason
they are pushing voters to reject the proposal. By
writing the tax change into the Massachusetts
constitution, critics argue, it restricts the
state’s ability to change the language should
officials later want to amend or repeal it.
The process of amending
the constitution requires votes in successive
two-year sessions before a proposal can go to
voters. And in the millionaires tax proposal’s case,
it will ultimately take seven years after advocates
first began collecting signatures in 2015 but saw
the Supreme Judicial Court reject an earlier
iteration of the measure before it could make it to
the 2018 ballot.
“You can be for more
transportation revenue, which we are, and not
support this tax increase,” said Eileen McAnneny,
president of the business-backed Massachusetts
Taxpayers Foundation, which in September warned the
MBTA is staring down “fiscal calamity” in the coming
years. McAnneny suggested state officials should
instead consider raising the gas tax or hiking fees
to address needs beyond the federal aid.
“Amending the
Constitution to include a tax just doesn’t make
sense,” she said.
Business leaders have
also repeatedly challenged the assertion the money
would go toward education and transportation as
promised, noting it would technically be “subject to
appropriation” — a phrase that gives the Legislature
wide latitude in deciding the fate of funding.
The Massachusetts High
Technology Council sent a letter to Attorney General
Maura Healey and Secretary of State William F.
Galvin asking that the description of the ballot
measure sent to voters include a line stating that
the Legislature could ultimately reduce funding on
education and transportation from other sources and
simply replace it with the new surtax revenue.
The
Boston Globe
Thursday, November 25, 2021
Massachusetts is now flush with
cash,
possibly reshaping debate over proposed millionaires
tax
The Mass Fiscal
Alliance is urging Gov. Charlie Baker to use some of
the state’s $4.6 billion rainy day fund to give
drivers a two-month gas tax holiday as prices reach
their highest Thanksgiving week average since 2012.
The tax break would
follow the two-month sales tax holiday Baker [un]successfully
pushed for in June.
Now, with the state
flush with cash and with drivers seeing the highest
cost of gasoline — an average of $3.42 per gallon —
since 2012, when it was $3.58, MassFiscal is urging
Baker to give drivers a “desperately needed”
two-month break from the state’s 24-cents-per-gallon
gas tax, said Paul Craney, spokesman for the
alliance.
“Gov. Baker should do
everything he can to provide relief for motorists
who have to drive to work, pick up their kids from
school and make long journeys over the holidays to
see family and friends,” Craney said.
Baker’s office did not
respond to requests for comment.
The
Boston Herald
Wednesday, November 24, 2021
MassFiscal pushes Gov.
Charlie Baker for a two-month gas tax relief holiday
Florida Governor Ron
DeSantis (R) knows how to make a splash, and his
proposal to
suspend the state’s gas tax—temporarily, but
without a specific end date—will only burnish that
reputation. Citing rising prices at the pump and the
state’s substantial revenue surplus, the governor is
calling upon the legislature to take the state’s gas
tax from 26.5 cents a gallon to zero, and to keep it
at zero as long as the additional revenues are there
to sustain it.
Florida has a “problem”
common to many states right now: skyrocketing tax
revenues, and uncertainty about how best to return
some of the surplus to taxpayers. It’s a good
problem to have, but also a vexing one, particularly
if state officials harbor doubts about the
permanence of new revenue levels.
Tax
Foundation
Tuesday, November 23, 2021
The Surprising Challenge of
Too Much Tax Revenue—and Florida’s No-Gas-Tax
Solution |
|
I'm confident you read my
traditional CLT "A Timeless Thanksgiving Day Message" sent out as a
CLT Update for the holiday. Paul Craney of MassFiscal had his
Thanksgiving message published in Thursday's Boston Herald on
Thanksgiving Day ("Kudos to Herald for shedding light
on faults with TCI scheme"), thanking all those
who helped halt Gov. Baker's TCI "boondoggle":
Anyone who drives a
car or consumes anything delivered by a truck has an extra
something to be thankful for this Thanksgiving, and that
something is the Boston Herald....
The Massachusetts
Fiscal Alliance was laser-focused on stopping the
scheme before it could start. We took a lot of heat
for being the loudest voice against the
environmental lobby and Gov. Baker, but our efforts
to resist the scheme in Massachusetts and organize
others to do the same in the other 12 states paid
off. Oftentimes, our work involved pointing people
in the direction of the great work being done at the
Herald and I am sure they felt similar pressure as
they continually reported on the truth of the issue.
The Boston Herald news reporters were often the only
ones asking Gov. Charlie Baker any hard questions
about the TCI scheme and for that, they should be
commended. Along with Boston Herald columnist Howie
Carr, the Boston Herald consistently delivered to
its readers important information about the scheme.
Others in the coalition
should be applauded as well. This includes Chip
Ford at Citizens for Limited Taxation,
the Beacon Hill Institute, the Committee to Stop the
TCI Tax, the bipartisan group of petitioners who
sought to bring the TCI repeal forward as a ballot
question in 2022, Chris Carlozzi at the National
Federation of Independent Business, MassGOP Chairman
Jim Lyons and everyone else who worked so hard to
stop this manipulative tax scheme. Without them, TCI
would still be moving forward.
Massachusetts is the
birthplace of the Thanksgiving Day holiday and
motorists across the mid-Atlantic and New England
can now be thankful that we are also not the
birthplace of the TCI gas tax scheme. We hope they
remember that this is due to the hard work of a lot
of people, with a special thanks to the staff and
reporters at the Boston Herald for speaking truth to
power for the benefit of the everyday people of our
great commonwealth.
Happy Thanksgiving,
Massachusetts!
The primary factor in Gov.
Baker's surrender was the lack of "critical mass," as advocates
called it — enough northeast and
mid-Atlantic states signing on to the multi-state compact to make it
viable. Preventing that was the impetus for MassFiscal's and
Paul Craney's early strategy to organize a multi-state alliance of
opposition organizations whose states would be similarly impacted if TCI were to be
implemented.
TCI couldn't be stopped in
Massachusetts alone, though its biggest advocate governed here,
claiming there were no checks or balances on his authority, no
legislative approval needed.
Those monthly Zoom
meetings hosted by MassFiscal for the past two-and-a-half years with
allies in states up and down the East Coast from Maine to North
Carolina, and each of those ally's efforts to stop TCI in their
respective states, all helped prevent "critical mass" from ever
being reached. Then those few state governors still aboard
suddenly fell like dominoes the week we filed our petitions with the
city registrars of voters and town clerks across the state to put a
question on the 2022 ballot to "stop the TCI gas tax"
— Connecticut, then Massachusetts,
followed by Rhode Island. It was over, at least "for the time
being" as Rhode Island noted in its withdrawal statement.
Last week I wrote about
the increasingly
dysfunctional Massachusetts Legislature. I'm not alone in
recognizing this and calling it out. In his Boston Herald
column on Monday ("Foot-dragging Massachusetts
Legislature continues to be national embarrassment")
Joe Battenfeld observed:
The Democratic-led
Massachusetts Legislature is now officially a
national embarrassment.
Lawmakers — who are
still able to work remotely because the State House
is closed to the public — are on a seven-week
holiday break while billions in federal COVID relief
funds sit there unspent.
So legislators get to
enjoy Thanksgiving and Christmas from home, playing
by their own rules while the rest of us struggle to
meet our work demands while stressing out over the
holidays.
And even when they come
back from break, Democratic leaders make sure they
do as little work as possible....
Massachusetts is one of
the only states in the country that hasn’t opened up
the historic State House to the public, citing the
continued threat of the coronavirus.
And Democratic leaders
refuse to release the names of five state reps who
haven’t been vaccinated, which doesn’t seem to be in
the public interest. And you can’t file a public
records request to find out the names of those reps
because the Legislature is exempted from the public
records laws....
It’s the height of
arrogance....
It underscores the
question: do we really need a full-time paid
Legislature?
Why are taxpayers
funding a Legislature that won’t come back to work —
even at the cost of delaying the spending of
billions in federal relief money? ...
The Legislature can
still meet in “informal sessions” through the
holiday but that won’t happen because a single
lawmaker can block any votes.
All this should strike
fear in the hearts of voters. Can you imagine how
much worse this would be if Democrats also
controlled the governor’s office?
Beyond being unable to spend the
massive bonanza fast enough, oh what a problem the Legislature
now has with the billions upon billions pouring into and
overflowing the state's coffers. That embarrassment of riches
is suddenly threatening their long-lusted for graduated income tax
constitutional amendment on the November 2022 ballot, the so-called
"Fair Share Amendment" aka, "Millionaires Tax."
Boston Globe reporter Matt Stout
provided insight into the dilemma for The Takers in his Thursday
report ("Massachusetts is now flush with
cash,
possibly reshaping debate over proposed millionaires
tax"):
Massachusetts has
nearly $5 billion in unspent federal stimulus
dollars to spread to its residents. At least another
$8 billion in aid is coming from the US government
to help repair roads, bolster public transit, and
shore up the state against climate change. The
state’s tax receipts are again running well ahead of
expectations.
This is good news for
Massachusetts. But the heady fiscal times could also
complicate a question that voters are set to answer
in the November 2022 election: Should Massachusetts
raise taxes on its wealthiest residents to generate
billions more for the state to spend? ...
A proposed constitutional
amendment that would layer a surcharge on yearly
earnings above $1 million will land on the
ballot in 2022, years after it first surfaced
during a time of mounting needs for
Massachusetts’ school and transportation systems
— and of financial uncertainty for the state.
The yawning shortfalls
and prospective billion-dollar budget gaps of
several years ago, however, have been replaced by an
unexpected budget surplus, a state emergency savings
account that’s surged to a record $4.6 billion, and
multibillion-dollar buckets of federal aid that
lawmakers say can bring “generational change” to
Massachusetts....
“It’s a totally
different landscape about the need to raise revenue
and what the revenue is for,” said Evan Horowitz,
executive director of the Center for State Policy
Analysis at Tufts University, which studies state
ballot questions. “In the short term, it has
weakened the argument for any kind of immediate tax
increase. The state is not desperately looking for
money. What I don’t know is if it fundamentally
changes the long-term issues” the revenue could be
used to address....
Through October,
Massachusetts had collected $723 million more in tax
revenues than it was expecting through those four
months of the fiscal year, a trend that Alan
Clayton-Matthews, an economist and Northeastern
University professor emeritus, said sets the state
up to “most certainly” see a surplus by the end of
June.
“Those who don’t want
to pay for it are going to use what we’re dealing
with at the moment and make an argument, ‘Gee whiz,
the Fair Share Amendment really isn’t needed now,’ ”
said Representative James J. O’Day, who sponsored
the amendment.
“I get a little annoyed
when people say, ‘Oh my goodness, we have money
today.’ This is a short-term fix,” the West Boylston
Democrat said of federal aid. “The Fair Share
Amendment isn’t a sprint. It’s not a one-time deal,
not a two-time deal. It’s annually. That can only be
a benefit to our families, to our communities, to
our businesses, to infrastructure.”
But opponents say the
current big pots of money shouldn’t be ignored at
the ballot box, even if it’s not the only reason
they are pushing voters to reject the proposal. By
writing the tax change into the Massachusetts
constitution, critics argue, it restricts the
state’s ability to change the language should
officials later want to amend or repeal it.
The process of amending
the constitution requires votes in successive
two-year sessions before a proposal can go to
voters. And in the millionaires tax proposal’s case,
it will ultimately take seven years after advocates
first began collecting signatures in 2015 but saw
the Supreme Judicial Court reject an earlier
iteration of the measure before it could make it to
the 2018 ballot.
“You can be for more
transportation revenue, which we are, and not
support this tax increase,” said Eileen McAnneny,
president of the business-backed Massachusetts
Taxpayers Foundation, which in September warned the
MBTA is staring down “fiscal calamity” in the coming
years. McAnneny suggested state officials should
instead consider raising the gas tax or hiking fees
to address needs beyond the federal aid.
“Amending the
Constitution to include a tax just doesn’t make
sense,” she said.
Business leaders have
also repeatedly challenged the assertion the money
would go toward education and transportation as
promised, noting it would technically be “subject to
appropriation” — a phrase that gives the Legislature
wide latitude in deciding the fate of funding.
The Massachusetts High
Technology Council sent a letter to Attorney General
Maura Healey and Secretary of State William F.
Galvin asking that the description of the ballot
measure sent to voters include a line stating that
the Legislature could ultimately reduce funding on
education and transportation from other sources and
simply replace it with the new surtax revenue.
It's said that timing is
everything. Let's hope the voters recognize that even more cash for
the state to squander is more unnecessary now than it has ever been
— even if they don't recognize the
grave long-term threat a graduated income tax by any warm-and-fuzzy
name cracking the constitutional flat tax barrier eventually
presents on everyone.
The
Boston Herald reported on Wednesday ("MassFiscal pushes Gov.
Charlie Baker for a two-month gas tax relief holiday"):
The Mass Fiscal
Alliance is urging Gov. Charlie Baker to use some of
the state’s $4.6 billion rainy day fund to give
drivers a two-month gas tax holiday as prices reach
their highest Thanksgiving week average since 2012.
The tax break would
follow the two-month sales tax holiday Baker [un]successfully
pushed for in June.
Now, with the state
flush with cash and with drivers seeing the highest
cost of gasoline — an average of $3.42 per gallon —
since 2012, when it was $3.58, MassFiscal is urging
Baker to give drivers a “desperately needed”
two-month break from the state’s 24-cents-per-gallon
gas tax, said Paul Craney, spokesman for the
alliance.
“Gov. Baker should do
everything he can to provide relief for motorists
who have to drive to work, pick up their kids from
school and make long journeys over the holidays to
see family and friends,” Craney said.
Baker’s office did not
respond to requests for comment.
What a contrast to what
the Republican governor of Florida, Ron DeSantis, has proposed for
using some of the Sunshine State's windfall. The Tax
Foundation reported on Tuesday ("The Surprising Challenge of
Too Much Tax Revenue—and Florida’s No-Gas-Tax
Solution"):
Florida Governor Ron
DeSantis (R) knows how to make a splash, and his
proposal to
suspend the state’s gas tax—temporarily, but
without a specific end date—will only burnish that
reputation. Citing rising prices at the pump and the
state’s substantial revenue surplus, the governor is
calling upon the legislature to take the state’s gas
tax from 26.5 cents a gallon to zero, and to keep it
at zero as long as the additional revenues are there
to sustain it.
Florida has a “problem”
common to many states right now: skyrocketing tax
revenues, and uncertainty about how best to return
some of the surplus to taxpayers. It’s a good
problem to have, but also a vexing one, particularly
if state officials harbor doubts about the
permanence of new revenue levels.
Jacksonville, Florida TV
station
WJXT-TV4
reported on Monday ("As Florida prices soar, DeSantis proposes $1B in gas tax
relief"):
DAYTONA BEACH, Fla. – As Florida’s gas prices soar ahead of
the Thanksgiving holiday, Gov. Ron DeSantis on Monday said
he is proposing over $1 billion in gas tax relief in an
effort to help lower gas prices in the state.
“The average family over a five or six month period, you
know, could save up to $200,” DeSantis said during a news
conference at a Daytona Beach Buc-ee’s. “There’s a whole
bunch of things that go into the price of gas. There’s
different taxes, federal, state, local level, we’re taking
over 25 cents from Florida and we will basically zero that
out for as long as we can and do over a billion dollars.
That’s going to make a huge, huge deal.”
Millions of Floridians are expected to hit the road this
week and when they do, they’ll be paying the most expensive
Thanksgiving gas prices in eight years. Florida’s average
per-gallon price stands at $3.36, the highest mark since
$3.45 in 2013, according to AAA.
Wouldn't it be nice if
even for just once Massachusetts state government could set aside
the usual self-serving greed, visions of how that money can be
better spent by them, and think of its subjects, the productive
taxpayers struggling to get by on their own?
Nah, that's too much
wishful thinking. It won't happen on Bacon Hill without
bringing out the torches and pitchforks.
As I keep saying
— "It doesn't need to be The
Massachusetts Way"!
|
 |
 |
|
Chip Ford
Executive Director |
|
|
The Boston
Herald
Thursday, November 25, 2021
Kudos to Herald for shedding light on faults with TCI scheme
By Paul Diego Craney
Anyone who drives a car or consumes anything delivered by a
truck has an extra something to be thankful for this
Thanksgiving, and that something is the Boston Herald. The
Herald’s work editorializing against the regressive carbon
gas tax scheme known as the Transportation and Climate
Initiative and vigorously reporting on its faults over the
last two and half years was critical to the scheme’s demise
earlier last week. Without the local media coverage provided
by the Herald, residents would have been hard pressed to
find any accurate information on the potential 12-state
scheme. Other Boston-based media outlets refused to cover
the negative economic impacts and only covered the
idealistic and virtuous aspects of TCI.
The TCI gas tax scheme could never have delivered any
emissions reductions without inflicting significant economic
harm on ordinary Massachusetts families. TCI was championed
by Gov. Charlie Baker as a way to drive up fuel costs in
order to lower demand, as well as to collect more money from
taxpayers without calling it a tax. Motor fuels are
considered inelastic, so TCI’s architects knew their actions
had to be aggressive to change consumer behaviors. Gov.
Baker’s former head of climate change famously said the
quiet part out loud during a Zoom meeting with the Vermont
Climate Council that went viral. The unelected bureaucrat
described the need to “turn the screws” on people such as
“the person across the street, the senior on fixed income,”
and to “break the will” of ordinary people to achieve their
arbitrary climate goals. The TCI scheme was designed to
create a revolution, not an evolution, in the market.
The Massachusetts Fiscal Alliance was laser-focused on
stopping the scheme before it could start. We took a lot of
heat for being the loudest voice against the environmental
lobby and Gov. Baker, but our efforts to resist the scheme
in Massachusetts and organize others to do the same in the
other 12 states paid off. Oftentimes, our work involved
pointing people in the direction of the great work being
done at the Herald and I am sure they felt similar pressure
as they continually reported on the truth of the issue. The
Boston Herald news reporters were often the only ones asking
Gov. Charlie Baker any hard questions about the TCI scheme
and for that, they should be commended. Along with Boston
Herald columnist Howie Carr, the Boston Herald consistently
delivered to its readers important information about the
scheme.
Others in the coalition should be applauded as well. This
includes Chip Ford at Citizens for Limited
Taxation, the Beacon Hill Institute, the Committee to
Stop the TCI Tax, the bipartisan group of petitioners who
sought to bring the TCI repeal forward as a ballot question
in 2022, Chris Carlozzi at the National Federation of
Independent Business, MassGOP Chairman Jim Lyons and
everyone else who worked so hard to stop this manipulative
tax scheme. Without them, TCI would still be moving forward.
Massachusetts is the birthplace of the Thanksgiving Day
holiday and motorists across the mid-Atlantic and New
England can now be thankful that we are also not the
birthplace of the TCI gas tax scheme. We hope they remember
that this is due to the hard work of a lot of people, with a
special thanks to the staff and reporters at the Boston
Herald for speaking truth to power for the benefit of the
everyday people of our great commonwealth.
Happy Thanksgiving, Massachusetts!
— Paul Diego Craney is the
spokesman for Massachusetts Fiscal Alliance.
The Boston
Herald
Monday, November 22, 2021
Foot-dragging Massachusetts Legislature continues to be
national embarrassment
By Joe Battenfeld
The Democratic-led Massachusetts Legislature is now
officially a national embarrassment.
Lawmakers — who are still able to work remotely because the
State House is closed to the public — are on a seven-week
holiday break while billions in federal COVID relief funds
sit there unspent.
So legislators get to enjoy Thanksgiving and Christmas from
home, playing by their own rules while the rest of us
struggle to meet our work demands while stressing out over
the holidays.
And even when they come back from break, Democratic leaders
make sure they do as little work as possible.
Legislative leaders on Monday unveiled a plan to get some
workers back into the office in person starting Dec. 13, but
lawmakers themselves will not be subject to that plan and
will continue to work and cast votes remotely into the
immediate future.
The Biden administration, meanwhile, is throwing money at
the state while thousands are unemployed or underemployed,
businesses are struggling and residents are paying millions
more for gasoline and groceries.
And the Legislature is dragging its feet, locked in
political games and power disputes.
Massachusetts is one of the only states in the country that
hasn’t opened up the historic State House to the public,
citing the continued threat of the coronavirus.
And Democratic leaders refuse to release the names of five
state reps who haven’t been vaccinated, which doesn’t seem
to be in the public interest. And you can’t file a public
records request to find out the names of those reps because
the Legislature is exempted from the public records laws.
Why aren’t they being more transparent?
Considering they’ve exempted themselves from everything
else, it makes perfect sense they’d also be shielding their
own from scrutiny.
It’s the height of arrogance.
They are requiring their own employees to be vaccinated yet
refusing to identify the legislators who are breaking those
rules.
It underscores the question: do we really need a full-time
paid Legislature?
Why are taxpayers funding a Legislature that won’t come back
to work — even at the cost of delaying the spending of
billions in federal relief money?
Gov. Charlie Baker proposed spending the ARPA money way back
in May, and wanted to put it to housing aid and other vital
programs.
But no, petty lawmakers played politics and didn’t want
Baker — who could run for a third term next year — to get
credit for allocating the money. So they wasted months on
alleged public hearings which were more of a dog and pony
show, since the public isn’t even allowed back in the
building.
What this is really about is control — the Legislature wants
it and doesn’t want Baker to have it.
The Legislature can still meet in “informal sessions”
through the holiday but that won’t happen because a single
lawmaker can block any votes.
All this should strike fear in the hearts of voters. Can you
imagine how much worse this would be if Democrats also
controlled the governor’s office?
Yet that could happen next year if Baker decides to take a
pass on another term.
The Boston
Globe
Thursday, November 25, 2021
Massachusetts is now flush with cash,
possibly reshaping debate over proposed millionaires tax
By Matt Stout
Massachusetts has nearly $5 billion in unspent federal
stimulus dollars to spread to its residents. At least
another $8 billion in aid is coming from the US government
to help repair roads, bolster public transit, and shore up
the state against climate change. The state’s tax receipts
are again running well ahead of expectations.
This is good news for Massachusetts. But the heady fiscal
times could also complicate a question that voters are set
to answer in the November 2022 election: Should
Massachusetts raise taxes on its wealthiest residents to
generate billions more for the state to spend?
A proposed constitutional amendment that would layer a
surcharge on yearly earnings above $1 million will land on
the ballot in 2022, years after it first surfaced during a
time of mounting needs for Massachusetts’ school and
transportation systems — and of financial uncertainty for
the state.
The yawning shortfalls and prospective billion-dollar budget
gaps of several years ago, however, have been replaced by an
unexpected budget surplus, a state emergency savings account
that’s surged to a record $4.6 billion, and
multibillion-dollar buckets of federal aid that lawmakers
say can bring “generational change” to Massachusetts.
That perception of a flush state government has shifted the
ground under the intensifying debate between labor unions
and activists, who warn the state’s needs will far outstrip
its current financial good fortune and business leaders who
caution that hiking taxes on the rich could unnecessarily
undercut the state’s competitiveness.
“It’s a totally different landscape about the need to raise
revenue and what the revenue is for,” said Evan Horowitz,
executive director of the Center for State Policy Analysis
at Tufts University, which studies state ballot questions.
“In the short term, it has weakened the argument for any
kind of immediate tax increase. The state is not desperately
looking for money. What I don’t know is if it fundamentally
changes the long-term issues” the revenue could be used to
address.
The so-called millionaires tax would impose a 4-percent
surtax on annual personal income above $1 million. According
to a state analysis that is now six years old, the measure
could generate anywhere between $1.6 billion and $2.2
billion in revenue each year, though opponents argue the
estimates are inflated.
Its supporters say the money could immediately go toward
financing the state’s new school funding system passed in
2019 while also helping rebuild the state’s crumbling roads
and update a woefully underfunded MBTA. They also argue the
measure, dubbed the Fair Share Amendment, would inject
equity into what they describe as an unfair flat state
income tax rate, which is currently set at 5 percent.
“The Fair Share Amendment is not about one budget cycle.
It’s about making generational investments over the next 10,
20, 30, 40 years,” said Andrew Farnitano, a spokesman for
Raise Up Massachusetts, the coalition that’s organized
behind the effort since 2015. “From our perspective, the
need for the investment has never been greater coming out of
the pandemic.”
During the public health crisis, the state has also reaped
newfound and unexpected resources. Legislative leaders are
still negotiating the details of a roughly $4 billion
package that pulls money from $4.9 billion in federal
American Rescue Plan Act aid and a $1.5 billion state
surplus.
Once they reach an agreement, there will likely still be
billions left to be spent in the months or even years ahead,
when the state could also see even more extra cash. Through
October, Massachusetts had collected $723 million more in
tax revenues than it was expecting through those four months
of the fiscal year, a trend that Alan Clayton-Matthews, an
economist and Northeastern University professor emeritus,
said sets the state up to “most certainly” see a surplus by
the end of June.
“I think people will have the feeling that times are good,
as far as revenues for the state go,” he said.
The state can also expect to receive at least $8.5 billion
over several years through the new federal infrastructure
law, including funding for airports, public transit,
bridges, and electric vehicle chargers. It’s money that can
effectively target one of the primary goals of the
millionaires tax: Seeding badly needed capital work.
The tax proposal’s proponents — including all three
Democratic gubernatorial candidates — say that while the
federal aid can help jump start a variety of projects, it’s
not a substitute for a long-term tax increase.
Some officials also question how far the infrastructure bill
funding can ultimately go. “The jury is out if it is going
to be truly transformational,” said Senator Sonia Chang-Díaz,
a Jamaica Plain Democrat running for governor.
“Those who don’t want to pay for it are going to use what
we’re dealing with at the moment and make an argument, ‘Gee
whiz, the Fair Share Amendment really isn’t needed now,’ ”
said Representative James J. O’Day, who sponsored the
amendment.
“I get a little annoyed when people say, ‘Oh my goodness, we
have money today.’ This is a short-term fix,” the West
Boylston Democrat said of federal aid. “The Fair Share
Amendment isn’t a sprint. It’s not a one-time deal, not a
two-time deal. It’s annually. That can only be a benefit to
our families, to our communities, to our businesses, to
infrastructure.”
But opponents say the current big pots of money shouldn’t be
ignored at the ballot box, even if it’s not the only reason
they are pushing voters to reject the proposal. By writing
the tax change into the Massachusetts constitution, critics
argue, it restricts the state’s ability to change the
language should officials later want to amend or repeal it.
The process of amending the constitution requires votes in
successive two-year sessions before a proposal can go to
voters. And in the millionaires tax proposal’s case, it will
ultimately take seven years after advocates first began
collecting signatures in 2015 but saw the Supreme Judicial
Court reject an earlier iteration of the measure before it
could make it to the 2018 ballot.
“You can be for more transportation revenue, which we are,
and not support this tax increase,” said Eileen McAnneny,
president of the business-backed Massachusetts Taxpayers
Foundation, which in September warned the MBTA is staring
down “fiscal calamity” in the coming years. McAnneny
suggested state officials should instead consider raising
the gas tax or hiking fees to address needs beyond the
federal aid.
“Amending the Constitution to include a tax just doesn’t
make sense,” she said.
Business leaders have also repeatedly challenged the
assertion the money would go toward education and
transportation as promised, noting it would technically be
“subject to appropriation” — a phrase that gives the
Legislature wide latitude in deciding the fate of funding.
The Massachusetts High Technology Council sent a letter to
Attorney General Maura Healey and Secretary of State William
F. Galvin asking that the description of the ballot measure
sent to voters include a line stating that the Legislature
could ultimately reduce funding on education and
transportation from other sources and simply replace it with
the new surtax revenue.
The tax debate is likely to seep into other races on the
2022 ballot. Governor Charlie Baker — who has opposed
broad-based tax increases and indicated he, too, is against
the millionaires tax — has cast doubt on the proposal’s need
given the federal aid.
He’s also questioned how much it would actually raise. The
second-term Republican, who has yet to say whether he’ll
seek a third, has echoed business leaders in suggesting the
tax could push high earners out of Massachusetts. “We should
be very careful about . . . how much we think we might raise
through something like the Fair Share tax,” Baker said on
GBH’s “Boston Public Radio” in September.
One Republican who is already running for governor next
year, Geoff Diehl, a former state representative, also
opposes the proposal, saying it would have a “chilling
effect on economic development.”
Democratic candidates, however, have embraced it. Danielle
Allen, a Harvard professor, said she supports the proposed
amendment, saying federal aid will only address the “initial
hurdles” in investing in infrastructure. But she also
suggested officials could revisit the need for it at a later
date. “It doesn’t mean you need to have it in perpetuity,”
she said.
Ben Downing, a former state senator, said that people can
argue the federal funds may be enough “to manage the status
quo,” but that the state’s needs demand more, leaning into
criticisms he and other Democrats have lobbed at what they
view as Baker’s incremental approach to governing.
“It’s important to ask candidates who don’t support the Fair
Share Amendment why we should be reliant on the federal
government to fund things we consider priorities,” he said.
— Jon Chesto of the Globe
staff contributed to this report.
The Boston
Herald
Wednesday, November 24, 2021
MassFiscal pushes Gov. Charlie Baker for a two-month gas tax
relief holiday
By Marie Szaniszlo
The Mass Fiscal Alliance is urging Gov. Charlie Baker to use
some of the state’s $4.6 billion rainy day fund to give
drivers a two-month gas tax holiday as prices reach their
highest Thanksgiving week average since 2012.
The tax break would follow the two-month sales tax holiday
Baker [un]successfully pushed for in June.
Now, with the state flush with cash and with drivers seeing
the highest cost of gasoline — an average of $3.42 per
gallon — since 2012, when it was $3.58, MassFiscal is urging
Baker to give drivers a “desperately needed” two-month break
from the state’s 24-cents-per-gallon gas tax, said Paul
Craney, spokesman for the alliance.
“Gov. Baker should do everything he can to provide relief
for motorists who have to drive to work, pick up their kids
from school and make long journeys over the holidays to see
family and friends,” Craney said.
Baker’s office did not respond to requests for comment.
Massachusetts collects approximately $50 million in gas tax
revenue per month, Craney said. A gas tax holiday would
follow the two-month sales tax holiday that Baker pushed for
in June, using some of the state’s excess tax revenue
“When he first ran in 2014, he understood the importance of
fuel prices to the working people of Massachusetts,” Craney
said. “He now has an opportunity to help motorists when they
could use his leadership the most. We hope he takes it.”
“Rainy-day funds are funds stored for taxpayer relief,” said
Frank Conte, a policy analyst at the Beacon Hill Institute,
a conservative think tank. “For many years, legislators have
avoided returning those dollars to taxpayers. But giving
drivers a rare tax break isn’t a bad thing.”
President Biden on Tuesday ordered a record 50 million
barrels of oil released from America’s strategic reserve,
aiming to bring down gasoline and other costs, in
coordination with other major energy consuming nations
including India, the United Kingdom and China.
The U.S. action is focused on helping Americans coping with
higher fuel and other prices ahead of Thanksgiving and
winter holiday travel. Gasoline prices are at about $3.40 a
gallon, more than 50% higher than a year ago, according to
the American Automobile Association.
“While our combined actions will not solve the problems of
high gas prices overnight, it will make a difference,” Biden
promised in remarks at the White House. “It will take time,
but before long you should see the price of gas drop where
you fill up your tank.”
— Herald wire services
contributed to this report.
Tax
Foundation
Tuesday, November 23, 2021
The Surprising Challenge of Too Much Tax Revenue—and
Florida’s No-Gas-Tax Solution
By Jared Walczak
Florida Governor Ron DeSantis (R) knows how to make a
splash, and his proposal to
suspend the state’s gas tax—temporarily, but without a
specific end date—will only burnish that reputation. Citing
rising prices at the pump and the state’s substantial
revenue surplus, the governor is calling upon the
legislature to take the state’s gas tax from 26.5 cents a
gallon to zero, and to keep it at zero as long as the
additional revenues are there to sustain it.
Florida has a “problem” common to many states right now:
skyrocketing tax revenues, and uncertainty about how best to
return some of the surplus to taxpayers. It’s a good problem
to have, but also a vexing one, particularly if state
officials harbor doubts about the permanence of new revenue
levels. Lowering taxes, even temporarily, puts more money in
people’s pockets, which has economic benefits (and is
desirable in its own right), but it’s not pro-growth in the
way that permanent rate reductions or meaningful structural
reform is.
While DeSantis’s most prominent potential Democratic
opponent—former Gov. Charlie Crist (D), who previously
governed the state as a Republican—has criticized the
proposed $1 billion tax cut, his critique is that it should
have been taken up in special session this year. In 2022,
Florida voters may well be choosing between two
gubernatorial candidates who believe the appropriate gas tax
rate to be zero—and indeed, it may already be the new rate
by then.
Whatever policy rationales stand behind the proposal,
there’s another reason why both candidates are aligning
themselves with the idea: reducing gas tax burdens is good
politics. Political candidates have been deemed out of touch
for not knowing the price of a gallon of milk, but even
consumers who purchase milk regularly may not notice every
price fluctuation, whereas any driver can tell you how high
gas prices have soared in their area. It’s literally in
lights everywhere they turn, and with the average driver
purchasing over 650 gallons of motor fuel each year, high
prices at the pump take their toll.
Students of public finance, however, tend not to share this
popular enthusiasm for lower—or no—gas taxes because they
rightly see the motor fuel tax as one of the better examples
of a user-pays excise tax, where the amount one pays is at
least roughly commensurate with government benefits
received. Most state gas taxes are already set too low to
fully cover state infrastructure costs, but zeroing out the
gas tax is a massive subsidy for drivers, shifting the cost
of road construction and maintenance into tax revenue
streams that take no account of taxpayers’ use of state
infrastructure.
Well-designed excise taxes either create a user fee system
or internalize some meaningful externality, or both.
Theoretically the gas tax has the potential to do both, as
it could be envisaged as (1) covering the cost of using the
roads (user fee) as well as (2) putting a price on
contributions to road congestion and (3) having drivers bear
the social cost of emissions and other environmental harms
caused by driving (internalizing externalities). In
practice, however, nearly all motor fuel taxes fall short of
fully covering road expenditures, and that is true of
Florida, where motor fuel taxes, tolls, and license fees
combine to generate 79 percent of the amount needed to fund
the state’s highway spending. Therefore, while the gas tax
may have some role in nudging people toward more
fuel-efficient vehicles, consolidating trips, or switching
to other modes of transportation, its primary role is
clearly as a user fee.
At least as long as it doesn’t have a rate of zero cents per
gallon.
But Florida’s startling proposal of a lengthy gas tax
holiday is merely one of the starker examples of states’
broader challenges in figuring out what to do with
overflowing coffers. There is good reason to believe that
most states are on a continued revenue growth trajectory, so
at least some of this new revenue can be dedicated to
permanent tax relief. It is also the case, however, that
states are riding particularly high right now buoyed by
one-time money in the form of flexible federal aid and by
time-limited trends resulting from pandemic-era economic
activity and federal policy. To the extent that some states
see a *temporary* spike in tax collections, policymakers
face difficult choices, even if this is a good problem to
have.
Too often, states use one-time increases irresponsibly,
applying short-term revenues to permanently higher
expenditures. Similarly, while the current economic
environment provides ample room for most states to explore
responsible permanent tax reforms, there are certainly
historical examples of states using one-time revenues to
implement permanent tax cuts, without identifying future
offsets to make the plans balance. Prudence demands that
one-time money be dedicated to one-time expenditures.
States, therefore, have a few options:
• Depositing money into reserve
funds, like the state’s rainy day fund.
• Retiring debt or
reducing long-term liabilities, including replenishing
unemployment compensation trust funds and improving the
fiscal health of state pension funds.
• Making one-time
investments, whether that means upgrading DMV computer
systems, repairing bridges, undertaking water quality
improvement projects, or anything else that has a long-term
benefit but is not a recurring expenditure.
• Covering the
transition costs associated with structural tax reform,
providing a buffer in areas where there might be some
revenue uncertainty or some short-term transitional revenue
losses.
• Temporary tax relief,
restoring some of the surplus to taxpayers without creating
a long-term commitment.
Temporary tax relief is not as economically productive as
permanent tax reform. Individuals are unlikely to move to a
state or to work more hours, and businesses are unlikely to
relocate, to hire additional employees, or to expand
operations, based on tax cuts that will soon expire. (And a
zeroed-out gas tax, in particular, will not induce new
investment or economic activity.)
The political case for temporary tax relief is simple:
taxpayers will take note of a gas tax suspension. The policy
case, however, is predicated more on what it forestalls.
Even a relatively inefficient way of returning excess tax
revenue to the taxpayers is preferable to applying
short-term revenue increases to new recurring expenditures.
(Other states have explored refund checks, which are
arguably superior to a gas tax holiday, but Florida already
forgoes an individual income tax.) Policymakers who aren’t
eager to grow the size of government, or at least not beyond
stable revenue trajectories, understandably prefer most
mechanisms to return the surplus to taxpayers to the
alternative of creating unsustainably higher budget
baselines.
But these aren’t the only choices.
It makes sense for those driving on Florida’s roads to bear
the cost of maintaining them, so suspending the gas
tax—while one of the easiest ways to return taxpayer
dollars—is also among the least economically efficient. Even
beyond the specific mechanism, however, it is better for
policymakers to use one-time revenue increases to make the
sort of investments that can keep taxes low in the future.
That can mean making sure a state’s rainy day fund is
adequately funded (avoiding the need for tax increases
during a future recession), reducing unfunded pension
liabilities (which also has future tax implications), or
using the revenue buffer to offset the transition costs of
structural tax reform.
Florida does not have a throwback rule in its corporate
income tax, but throwback rules provide a good example of
what it could look like to cover transition costs. Economic
analyses indicate that, in the long term, repealing
throwback rules does not reduce, and may even increase, tax
revenues, as business activities formerly driven out of
state return to the state. But in the short term, some
businesses that haven’t been able to avoid the tax will see
a tax cut, which can temporarily reduce state revenues. A
temporary revenue surge can bridge that gap.
Similarly, there’s often some level of revenue uncertainty
in tax reform. Now is a good time to act, because the higher
revenues provide a buffer in the event that the initial
projections are slightly off.
Most states—including Florida—are in a good position to
provide *permanent* tax relief given their revenue
forecasts. However, if they justifiably only feel confident
that a portion of their currently higher revenues are
permanent, and have additional one-time revenues to spend,
they should consider either using it to help phase in
meaningful long-term tax reform or for expenditures that
improve the state’s long-term fiscal health. Temporary tax
relief measures, like refund checks or gas tax holidays, are
not necessarily *bad," and can be justified as ways to
return excess revenues to taxpayers, but they often miss an
opportunity to do better by taxpayers in the long run.
WJXT-TV4
— Jacksonville, Florida
Monday, November 22, 2021
As Florida prices soar, DeSantis proposes $1B in gas tax
relief
By Renee Beninate
DAYTONA BEACH, Fla. – As Florida’s gas prices soar ahead of
the Thanksgiving holiday, Gov. Ron DeSantis on Monday said
he is proposing over $1 billion in gas tax relief in an
effort to help lower gas prices in the state.
“The average family over a five or six month period, you
know, could save up to $200,” DeSantis said during a news
conference at a Daytona Beach Buc-ee’s. “There’s a whole
bunch of things that go into the price of gas. There’s
different taxes, federal, state, local level, we’re taking
over 25 cents from Florida and we will basically zero that
out for as long as we can and do over a billion dollars.
That’s going to make a huge, huge deal.”
Millions of Floridians are expected to hit the road this
week and when they do, they’ll be paying the most expensive
Thanksgiving gas prices in eight years. Florida’s average
per-gallon price stands at $3.36, the highest mark since
$3.45 in 2013, according to AAA. |
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
▪ (781) 639-9709
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