Samantha J. Gross and Matt Stout, “Months in, Healey is scoring wins with a Democrat-led Legislature in the very places her GOP predecessor failed,” Boston Globe, April 17, 2023.
“The disappointing thing about this is that many people were looking forward to having a Democratic trifecta,” said Jonathan Cohn, policy director of Progressive Massachusetts.“But they weren’t hoping to have a Democratic trifecta get tax breaks for day traders and speculators.”
Last November, voters sent a message by voting for the Fair Share Amendment: the rich should pay their fair share so that we can invest in public education and infrastructure. For years, the Legislature has used the line “We don’t have the money” to justify inaction and underinvestment; we got them the money.
But on Thursday, the MA House made clear that they plan to give money right back to the rich and large corporations by passing a tax cut package filled with giveaways to the richest residents of the Commonwealth. Last year, many representatives were quite clear that they intended for the new revenue from the Fair Share Amendment to be fully additive, rather than backfilling cuts. Even though the House laid out promising and important uses for the constitutionally dedicated funds, voters should wonder how much legislators believe their own pledges given the permanent tax cuts they just passed.
The vote was 150 to 3, with only Rep. Mike Connolly (D-Cambridge), Rep. Dan Sena (D-Acton), and Rep. Erika Uyterhoeven (D-Somerville) voting no.
Almost half of the cost of their tax proposal comes from the three regressive tax cuts:
Think of all that we could do with $440 million if instead we invested it in our public transit systems, in education, in child care, in climate resilience, in affordable housing, or in health care. Indeed, tackling our housing crisis should be the #1 priority if legislators actually cared about the goals of “affordability” and “competitiveness.” By passing such regressive tax cuts, the House is disrespecting the will of the voters, and they are setting Massachusetts up for brutal cuts when the next recession hits.
Even the less regressive parts of the tax package could go further if invested in robust social programs. The House bill would spend $40 million on an increase in the Renters Deduction from $3,000 to $4,000. However, this in reality, only yields to a tax credit of up to $50 for eligible renters. An extra $50 in the pocket of renters ultimately won’t go very far, given escalating rents and costs in general. As Rep. Mike Connolly pointed out, the state could have used the same money to guarantee all renters access to legal counsel in eviction cases, a measure with far lasting benefits.
The largest part of the tax package is the child and family tax credit, which would amount to $600 per child under 13 or dependent adult and cost $487 million. As I noted before, it is unclear why parents of teenagers should not get the same benefit: any parent of a teenager will tell you how much it costs to feed a teenager. Families with low and middle incomes will certainly benefit from extra money in their pocket, but $600 will not last long given that two weeks of child care costs more than that. The credit thus does little to address the real drivers of the cost of living in Massachusetts, even if it can help around the edges.
A more progressive part of the House’s tax package that was not in the Governor’s proposal was the expansion of the Earned Income Tax Credit (EITC), which would benefit about 396,000 taxpayers with incomes under $57,000, and would cost $91 million. However, it is important to remember that the EITC was originally a conservative proposal, born of opposition to a strong minimum wage and a robust safety net.
According to Mass Budget, we could make all public colleges and universities in the state tuition-free — or make all community colleges debt-free — for approximately $1 billion. State legislators would demand that such a proposal be funded. So why shouldn’t their tax expenditures have to be funded as well?
John Budenas, “House sends $1.1 Bil tax relief bill to senate,” State House News Sevice, April 13, 2023.
The Progressive Massachusetts group zeroed in on the estate tax, short-term capital gains tax and single sales factor apportionment reforms collectively worth about $440 million as pressure points. During its lobby day earlier on Thursday, the organization slammed those measures as “regressive” and likely to blunt the impact of a newly voter-enacted surtax on high earners.
“Think of all that we could do with $440 million if instead we invested it in our public transit systems, in education, in child care, in climate resilience, in affordable housing, or in health care,” the group wrote in a handout from its event. “Indeed, tackling our housing crisis should be the #1 priority if legislators actually cared about the goals of ‘affordability’ and ‘competitiveness.’”
Last November, voters sent a message by voting for the Fair Share Amendment: the rich should pay their fair share so that we can invest in public education and infrastructure. For years, the Legislature has used the line “We don’t have the money” to justify inaction and underinvestment; we got them the money.
But, yesterday, the House, in unveiling their tax package, said that they plan to give money right back to the rich and large corporations.
Almost half of the cost of their tax proposal comes from the three regressive tax cuts:
Think of all that we could do with $440 million if instead we invested it in our public transit systems, in education, in child care, in climate resilience, in affordable housing, or in health care. Indeed, tackling our housing crisis should be the #1 priority if legislators actually cared about the goals of “affordability” and “competitiveness.” Indeed, even the less regressive parts of the tax package could go further if invested in a robust social programs. By proposing such regressive tax cuts, the House is disrespecting the will of the voters, and they are setting Massachusetts up for brutal cuts when the next recession hits.
Disappointed too? Let your state representative know.
You can also let your state representative know (on phone or in person tomorrow) that you want them to support two amendments filed by Rep. Mike Connolly:
Joan Vennochi, “When it comes to issues facing the state, it’s Maura ‘in the middle’ Healey,” Boston Globe, April 10, 2023.
“To progressive Democrats, the answer is not enough. Pointing out that Healey’s tax reform proposal is basically the same as Baker’s, Jonathan Cohn, policy director of Progressive Massachusetts, said, “Her instinct has been to give that money back, weakening our state’s ability to deliver on the promise of investment.” On housing and transit, he added, “I think we need to see more from her administration about what their major goals are and how they would track their own success. There isn’t enough communicated urgency about what is needed for the affordability crisis and the crisis of the MBTA.” Cohn also flagged Healey for a “wait-and-see” attitude on zoning changes that are aimed at increasing affordable housing.””
Chris Lisinski, “House adds capital gains, biz cuts to $1.1B tax relief plan,” State House News Service, April 11, 2023.
The proposal drew criticism from some voices on the left. “Our Democratic governor and Democratic Legislature fighting hard for the day traders … ,” tweeted Progressive Massachusetts Political Director Jonathan Cohn.
PM’s Policy Director was on WCVB5 this evening talking about why the House’s tax proposal misses the mark on affordability. Check out the video here.
This spring, the Massachusetts House and Senate will be voting on their budgets for the next fiscal year, and it’s critical that they make sure to complete and protect last year’s victories when doing so.
What does that mean?
First, that means protecting last year’s win on the ballot for the Fair Share Amendment. Voters were clear about wanting the rich to pay their fair share and for us to invest in our public education and infrastructure. However, Governor Healey’s proposed budget would give away almost as much in tax cuts as is estimated to be raised by Fair Share, undermining the hard work that went into that campaign. In particular, almost $400 million of her tax package consists of regressive tax cuts that will go to speculators and major estates. We need to make sure to protect the revenue we raised so that we can realize the vision of better schools, better roads, and better transit for all.
Second, last summer the MA House and MA Senate both included language from the No Cost Calls bill in their budgets, but a veto from Governor Baker doomed its fate. The Legislature needs to complete the No Cost Calls win by including language to permanently guarantee that neither state nor county prisons or jails will continue the predatory practice of charging incarcerated individuals and their loved ones for phone calls.
Testimony to the Joint Committee on Revenue on Tuesday, March 28, 2023 by Nina Lev of Roslindale
I am Nina Lev, a retired Physician Assistant. I have lived in Massachusetts for over 50 years and in Boston for 40 years. I am testifying in support of S.1784, a fairer and less costly proposal to reform the estate tax threshold without giving a tax break to multi-million dollar estates.
I voted and worked to pass the Fair Share Amendment because I am strong supporter of public education and transportation. As a single mom earning minimum wage I was able to complete my BA at U. Mass in 1978 because the tuition was so reasonable. My daughter received an excellent education in Mass Public school and is thriving in her career as an educator. As a senior citizen, I hope to age in place in Boston and be able to depend on public transportation. But I’m concerned that the current state of the MBTA will make that difficult. The T will need a lot of resources to make up for years of neglect.
I also voted for the Fair Share Amendment because I believe in Tax Fairness. As a member of Progressive WROX/ROZ I talked to hundreds of neighbors about the Fair Share Amendment at the farmer’s market and canvassing door to door and a vast majority of those I spoke with supported the amendment because they wanted to make the Massachusetts tax code fairer. Giving multi-million dollar estates a six figure tax cut is the opposite of what we wanted.
Lastly, I am retired from a successful career, which I attribute, in part, to the public education I have received. My estate could potentially be subject to an estate tax. If so, I will consider myself and my beneficiaries fortunate and hope that the funds go to create opportunities for the the next generations. As you consider reforms to the estate tax, please don’t give the largest estates a tax break.
Testimony from Keith Bernard before the Joint Committee on Revenue on Tuesday, March 28
Honorable chairs and members of the committee,
My name is Keith Bernard from Malden and for transparency, while I am an elected member of the Malden School Committee, I am not representing them and I am testifying on behalf of Mystic Valley Progressives, a chapter of Progressive Mass. I am also testifying because I am father and as of a month ago a grandfather. Our group supports favorable reporting of S.1784 and H.2960, a fairer and less costly proposal to reform the estate tax threshold without giving an enormous tax break to multi-million-dollar estates.
In November, I voted for the Fair Share Amendment because I believe that our public school systems as well as our transportation network had been underfunded for a long time. I saw my neighbors, and the children in my neighborhood not getting the services they needed to thrive. Educational professionals could not afford to work at a job that many of them loved. I saw my city having to make difficult choices to make our budgets work and I know that Malden is not the only municipality that faces these hard decisions.
You may know Malden, because of our recent teacher strike. I was happy to vote to approve raises for our teachers and especially our educational professionals. I have neighbors that work for the Malden Public School but were not being paid a living wage, and we fixed that. I do not want to look them in the face when we lose other programs that the working families of Malden because we now have a revenue gap.
We voted to have those who have a little more to pay their fair share. We asked for revenue to be generated in a fair manner so we could invest in our children and our workers. We need well-funded schools, and we need trains and buses that run on time and and regularly. However, I and our members do not support giving multimillion dollar estates a six-figure tax cut. As you consider reforms to the estate tax, please respect the will of the many who voted Yes on 1, and do not give the largest estates a tax break. Thank you for your time and we look forward to seeing S.1784 and H.2960 be reported out favorably.