Massachusetts Millionaires’ Surtax: Green Light?

Printed from: http://newbostonpost.com/2017/06/05/massachusetts-millionaires-surtax-green-light/

By Andy Metzger

STATE HOUSE NEWS SERVICE

BOSTON — There is a “good possibility” that the House and Senate will vote next week on advancing an income tax measure to draw $1.6 billion to $2.2 billion from the state’s highest earners, according to Massachusetts Speaker Robert DeLeo.

Senate President Stan Rosenberg, who will preside over the Wednesday, June 14 constitutional convention, kept the playbook to himself ahead of the joint session.

“It’s the first thing on the agenda and we are convening,” Rosenberg told the News Service. He said, “I never jump ahead of the convention.”

A proposed amendment to the Massachusetts state constitution that would add a 4 percent surtax on incomes over $1 million cleared the joint convention on 135-57 vote in May 2016. If lawmakers pass the proposal again this session it will be placed before voters in 2018 to ratify or reject it.

“I would say that’s a possibility,” DeLeo said Monday when asked if the constitutional convention would vote on the proposal (S 10) next week. “Right now I would say that’s a good possibility.”

Both DeLeo and Rosenberg are supportive of the citizen-led proposal, which opponents say would discourage wealthy residents from living in Massachusetts, cut into some small-business earnings, and cement tax code in the constitution, which is difficult to alter.

“There is no more progressive policy on the table right now that requires our attention than the Fair Share tax,” said Rosenberg, who last year called the back and forth over the amendment a “historic debate.”

Both legislative leaders spoke to the News Service after addressing the Massachusetts Nonprofit Network in the Great Hall.

Governor Charlie Baker, a Republican expected to seek re-election in 2018, has yet to take a stance on the proposal or join the debate over its merits.

“There are a lot of people that have spent that millionaire’s tax six ways to Sunday already and it hasn’t even made it to the ballot yet,” Baker told WCVB’s Ed Harding and Janet Wu in an interview that aired Sunday. “I think what we ought to do is focus on what we need to do to balance out fiscal ’17, which ends in about a month, and put a balanced budget in place for fiscal ’18 and not go back to the taxpayers thinking that they should be the source of all our solutions.”

Baker and legislative leaders are due to hear Monday about May tax revenue collections, which will influence the depth of changes that will be required to restrict spending growth and bring it in line with revenues. State officials say the fiscal year 2017 revenue gap may range from $375 million to $575 million.

While on board with a new tax on short-term rentals, Baker pivoted to “broad-based taxes,” calling them a “bad idea,” when asked whether he would support new taxes to address the state’s budget problems, an approach favored by some Democrats in the Legislature.

“I think we need to continue to live within our means. That’s what people in Massachusetts are doing,” Baker said.

“Our Republican Governor is again trying to have it both ways. While refusing to take a position on a constitutional amendment to increase taxes on annual income above one million dollars, he attacks those crying out for better public schools for their kids and improvements in our roads, bridges, and transit,” Massachusetts Democratic Party Chair Gus Bickford responded on Monday. “The Governor’s concern first-and-foremost is defending the wealthy campaign donors he’s counting on to fund his reelection campaign. How else could [he] not recognize the connection between good schools and reliable ways to get to work, and the improved earning power struggling middle class families so desperately need?”

Activists gathered roughly 100,000 certified signatures in 2015, more than enough to put the matter before the 200-seat Legislature. The amendment, which would take effect January 1, 2019, needs 50 votes from the House and Senate to make it to the November 2018 statewide general election ballot.

When the House and Senate convened the 2017-2018 constitutional convention in May, the body recessed until June 14 without taking up any business.

At the May 2016 convention where lawmakers first advanced the income surtax, state Representative Jay Kaufman of Lexington praised Rosenberg for his “passionate leadership to move us in the direction of a fair and sustainable tax system, an effort that I know has been a longstanding one for you and I am hopeful and optimistic that we will see you rewarded for your longstanding efforts and we hope to get this thing done on your watch.”

[Michael P. Norton contributed reporting]

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