Sales tax roll-back proposal runs into Democratic wall

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BOSTON – Saying state spending has risen 50 percent since 2006, state Rep. James Lyons appealed to his colleagues in the House of Representatives Monday to roll back the Massachusetts sales tax to 5 percent from 6.25 percent.

Rep. Stephen Kulik, a Worthington Democrat, argued for an amendment to study the proposal, saying a rollback would cut $1 billion from state revenue. “It’s critical funding,” he said, noting the proposed House budget increases state spending by $1.1 billion.

Lyons, a Republican from Andover, suggested that tax policy studies favored by Democrats over the years have not been conducted to examine the effects of the sales tax increase.

“I’ve been in here five years, I haven’t seen a study yet,” said Lyons, who with Republican Rep. Brad Hill of Ipswich said residents in northern Massachusetts have long spent their shopping dollars in sales tax-free New Hampshire. State law requires Massachusetts taxpayers to report such spending and to pay the appropriate tax, but there are no effective enforcement mechanisms to make sure they do.

Led by House Speaker Robert DeLeo, a Winthrop Democrat, the Legislature and former Democratic Gov. Deval Patrick raised the sales tax to 6.25 percent in 2009, from 5 percent. Most studies show that taxes on retail sales fall more heavily on the poor and households with moderate incomes, as they are seen as the least able to avoid paying it. Even Internal Revenue Service supports this view in guidance it offers to civics teachers.

As a gubernatorial candidate in 2010, Republican Charlie Baker favored a sales tax rollback to the old 5 percent rate.

State officials have routinely relied on one-time revenue to support state spending, and this year’s budget proposals take steps to reduce that reliance while building the state’s reserve fund to nearly $1.5 billion.

Rep. Angelo Scaccia, a Readville Democrat, said DeLeo was a fiscal conservative, despite increases in the gas and sales taxes under his watch.

“I don’t think anybody in this world can call you a tax-spender,” he said, referring to DeLeo.

Written by Michael Norton