How would a millionaire’s tax affect the Massachusetts economy? It would shrink it, according to a report from the Fiscal Alliance Foundation and The Beacon Hill Institute.
The two right-of-center organizations released a study earlier this month that shows that if Massachusetts voters approve the so-called Fair Share Amendment — which looks headed for the November 2022 general election ballot — it will result in job loss. The proposal would increase the marginal tax rate on household income over $1 million in Massachusetts from 5 percent to 9 percent — an 80 percent increase.
The study found that the tax hike would result in more than 4,000 families leaving the Commonwealth in 2023 alone and the state losing nearly 9,000 jobs. The study also projects that the tax hike wouldn’t bring in as much revenue as proponents say it will. While advocates project $2 billion in new revenue as a result of the tax, the study projects about 60 percent of that: $1.2 billion.
“This debate is being fueled by lawmakers acting on their worst urges and impulses to spend more money they don’t have. They wish to radically change the state constitution, by removing a cherished and longstanding safeguard that protects taxpayers,” Fiscal Alliance Foundation spokesman Paul Craney said in a written statement.
“If successful, lawmakers would have the ability to tax some taxpayers more than others. The state constitution would not be able to protect taxpayers from the stigma of Taxachusetts and greed of State House politicians,” he added.
While those who oppose a new tax increase in Massachusetts may think that the state has a spending problem, the progressive organization that’s pushing for a millionaire’s tax in the state, Raise Up Massachusetts, thinks there is a revenue problem.
“As we recover from the pandemic and in the future, new revenue is necessary to improve our public schools and pre-K programs; rebuild crumbling roads, bridges, sidewalks, and bike paths; make high-quality public higher education affordable; and invest in fast and reliable public transportation,” the pro-millionaires’-tax organization’s web site reads. “Long before the pandemic, we needed new investments in our transportation and public education systems, and now those investments are needed more than ever to lift our economy into an equitable recovery and tackle the longstanding racial inequities that hold our state back from its full potential.”
The Fair Share Amendment is the only question that has been confirmed to make the November 2022 ballot in Massachusetts thus far.
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