Working Together to Preserve Economic Stability

July 04, 2018

We’ve heard the expression “the devil’s in the details” bandied about recently. It’s a cliché that can contain some truth.

But the details can sometimes hide devils.

Take the Massachusetts economy, for example, where statistics show a state firing on all cylinders. The Commonwealth weathered a crippling recession and has experienced an explosion of investment, wealth creation, and employment. With a 3.5 percent unemployment rate, a growing labor force, and even rising wages, Massachusetts is the envy of other states. Construction jobs are flourishing, business profits are up, and the state has shed its antibusiness reputation. Continue reading

SJC Rejects ‘Millionaires Tax’ Ballot Question

By Jon Chesto and Joshua Miller 

JUNE 18, 2018

The Supreme Judicial Court on Monday rejected a ballot question that would have raised the state income tax on Massachusetts’ highest earners and put that money into transportation and education, delivering a crushing defeat for progressive activists and organized labor and removing a volatile issue from this fall’s election.

In a 5-2 decision, the court sided with business groups that argued the proposal was unconstitutional. The measure would have imposed a higher income tax rate for personal earnings above $1 million, a levy that would have brought in an estimated $2 billion in new revenue next year. Without that new money, several top elected officials were already hinting at the need for the Legislature to increase taxes or fees.

The majority of judges agreed with the business groups’ primary legal argument, saying Attorney General Maura T. Healey was wrong to certify the initiative because it had multiple subjects that were not related. The state constitution requires such ballot measures to have subjects that are related or “mutually dependent.” Continue reading

Misguided Millionaires Tax Was a Nonstarter

By Rachelle G. Cohen

JUNE 18, 2018

Make no mistake, Massachusetts just dodged the economic bullet that the so-called millionaires tax would have been.

But to those public employee unions and progressives that were virtually salivating over the potential $1.9 billion in new revenue extracted from the wallets of the state’s wealthiest residents, there ought to be a broader lesson — play fair.

The Supreme Judicial Court ruled 5-2 Monday that the effort to impose a 4 percent surtax on households with incomes of more than $1 million — thereby raising their tax rate to 9.1 percent, the fifth highest in the country — could not properly be put before the voters because it simply tried to do too much. Continue reading

SJC Should Spike Proposed Millionaires

By Jeff Jacoby

Sometime this spring, the Massachusetts Supreme Judicial Court will decide whether the so-called Fair Share Amendment can appear on the state ballot in November. The proposal would amend the Commonwealth’s constitution, which for more than 100 years has decreed that income may be taxed only at a uniform rate.  If approved, the initiative would subject anyone with more than $1 million in income to a surtax 4 percentage points higher than the state’s regular income tax rate of 5.1 percent.  The tax on million-dollar-plus incomes would thus rise to 9.1 percent — a prodigious 80 percent increase in the marginal tax rate.

Left-wing advocates have long resented the flat-rate income tax. They’ve repeatedly tried to get voters to approve an amendment to the Massachusetts Constitution doing away with it.  Five times they have sponsored ballot initiatives to open the door to graduated tax rates.  Five times voters have said no.

The latest effort, spearheaded by a coalition of labor unions and progressive activists called Raise Up Massachusetts, comes with two twists. Continue reading

Editorial: Defining ‘Related’ is Million-Dollar Question

By Boston Herald Editorial Staff

“Whether to amend the Constitution so we have a graduated income tax is an extraordinary public policy question,” said Kevin Martin, attorney for the plaintiffs.  “It’s an independent public policy issue which deserves independent consideration by the voters of the commonwealth.”

Supporters of the proposed “Millionaire’s Tax” have been clear on their goals.  They want the wealthy to contribute even more of their earnings to the state treasury.  They want more money for education. They want more money for transportation.

That they lumped all of these hopes and dreams into a single constitutional amendment, set to go before voters in November, may be what ultimately sinks this proposal.

In oral arguments before the state’s highest court yesterday, a lawyer for five business groups suing to disqualify the question from the ballot made a compelling case that, as conceived and as written, the proposed amendment fails the constitutional test.

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Judges Scrutinize Income Tax Surcharge

By Jon Chesto

If the business groups challenging the millionaires tax win their legal battle to block the ballot question, they might have the now-defunct greyhound industry to thank.

That’s because the Supreme Judicial Court justices who heard arguments for and against the question today zeroed in one aspect — the “relatedness issue.”  They pointed to earlier precedents by invoking memories of a 2006 ballot question to end greyhound racing as well as one they nixed in 2016 involving classroom curriculums and testing.

The “millionaires tax” would increase the income tax on any earnings above $1 million from 5.1 percent to 9.1 percent, based on today’s rate, and direct the extra funds to transportation and schools.  As much as $2 billion a year is on the line.
Continue reading

Justices Weigh Bid to Derail Income Surtax Ballot Proposal

By Andy Metzger

Supporters of a constitutional amendment to tax only the highest earners in Massachusetts, generating funds for education and transportation, encountered some skeptical Supreme Judicial Court justices on Tuesday who questioned the constitutionality of the proposal.

Initiative petitions must only contain subjects that are “related or which are mutually dependent,” according to the state Constitution, and the justices of the state’s highest court spent much of their Tuesday morning questioning whether the proposed ballot question meets that requirement.

“You’re connecting a progressive income tax to paying for education and transportation,” Justice Scott Kafker told Kate Cook, an attorney for proponents of the so-called Fair Share Amendment.  “Those seem to be three separate major policy decisions.”

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SJC Justices Question Design of Millionaires Tax Proposal

By Greg Ryan

The state’s highest court weighed Tuesday on whether the proposed “millionaires’ tax” should be allowed to go before voters later this year, with multiple justices questioning if the different parts of the proposal are related enough to pass constitutional muster.

The leaders of five of the state’s business advocacy groups are challenging the measure before the Supreme Judicial Court.  The proposal would impose an additional 4 percent surtax on Massachusetts residents making $1 million or more annually.  The revenue from the tax is supposed to fund two items only, education and transportation.  Opponents argue that higher taxes will scare away businesses, though supporters counter that better schools and transit will improve the Bay State’s business climate.

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High Court to Hear Challenge to Millionaire Tax Question

By the Associated Press

“It is not about whether creating a new graduated income tax is good public policy or bad public policy,” said Christopher Anderson, president of the Massachusetts High Technology Council.

Opponents of a so-called “millionaire tax” are banking on the state’s highest court to stop the issue from going before Massachusetts voters in November.

The Supreme Judicial Court is scheduled on Tuesday to hear arguments on the legal challenge which, if successful, would likely derail supporters’ hopes of raising nearly $2 billion for improvements in public education and transportation.

The constitutional amendment would impose a surtax of 4 percent on any portion of an individual’s annual income that exceeds $1 million.

The justices are not being asked to decide on the merits of the proposal, but instead whether it runs afoul of restrictions the state constitution places on the scope of ballot initiatives. Continue reading

Millionaire Tax Wrong Way to Play Robin Hood

The millionaire tax is a brilliantly marketed bad idea.  It’s hard not to find appeal in the concept of higher taxes on top earners when income disparity has grown dramatically in recent years.  An additional boost to that feeling comes from the new federal tax bill calculated to benefit plutocrats and further aggravate disparity.  Federal tax rates are still progressive but the richest will pay less on their U.S. returns so why not make them pay more to the Commonwealth?  Equally appealing is the requirement that revenue generated by the new millionaire tax must be spent on public education and transportation.

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