Citizens for Limited Taxation & Government
"The Commonwealth Activist Network"
18 Tremont Street #608 * Boston, MA 02108
Phone:(617) 248-0022 * E-Mail: cltg@cltg.org
Visit our web-page at: http://cltg.org
_______________________________________________________________

*** CLT&G Alert! ***
Friday, March 13, 1998

NEWS RELEASE
March 13, 1998:

FINNERAN "TAXPAYER RELIEF" PLAN:  REALLY A TAX INCREASE
"BIGGEST TAX CUT IN STATE HISTORY" RAISES TAXES
BY $148 MILLION MORE THAN IT CUTS"

WAKE UP MASSACHUSETTS!

Memo to State House media: LOOK AT THE NUMBERS!

Start with this year, tax year 1998: According to numbers released by the House leadership, the bill reduces taxes $302.3 million (Speaker Finneran’s chart says $304.3 million but the addition is wrong): $278.6 million with the earned income tax cut; $64 million with the new dependent exemption; $58 million with the new dependent deduction; for a total cut of $400.6 million. The leadership then admits it raises the capital gains tax by $98.3 million, and claims a net tax cut of $302.3 million.

But then note sections one and two: The summary released by Rep. Larkin contains a "typo": it reads "SECTION 1 of the bill decreases the cap on the Stabilization Fund from 5% to 7.5% of the total budgeted revenues." This sentence makes no sense, since 5 percent to 7.5 percent is an obvious increase. And in fact, the bill increases the cap on the Stabilization Fund.

The present Stabilization Fund transfers money to the Tax Reduction Fund for an increase in the personal exemption at the level of $930 million.

The Finneran "Tax Relief Plan" adds another $450 million to the Stabilization Fund before the tax cut is triggered.

That is another tax increase for 1998 of $450 million, along with the admitted $98.3 million capital gains tax increase, for a total tax increase of $548.3 million.

As noted above, the total tax cut is $400.6 million.

The bill has a net tax increase of $147.7 million for 1998 -- at the same time the state carries a record surplus.

And everybody voted for it!  Finneran rolled them all again.

- 30 -

* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
You can e-mail CLT&G at --> cltg@cltg.org
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *