Council in the News
BOSTON — A coalition of business groups is eyeing the 2026 ballot with a proposal to cut the state’s personal income tax rate and cap spending as part of broader efforts to create more jobs and improve competitiveness.
A proposal filed Wednesday by the Massachusetts High Technology Council on behalf of businesses and taxpayers asks voters to reduce the personal income tax rate from 5% to 4% over a three-year period, which the group says would save individual taxpayers an estimated $3,000 during that period.
Another initiative petition filed by the coalition would overhaul the voter-approved 62F law, which requires Massachusetts to refund money when tax revenues grow by more than wages and salaries.
That plan calls for revising the state’s revenue cap formula to “slow state budget growth and ensure more consistent and predictable excess revenue refunds to taxpayers.”
Mass High Tech Council President Chris Anderson said the referendums are aimed at addressing “the root causes of Massachusetts’ competitiveness challenges.”
“We’re seeing the consequences of out-of-control spending and tax policy that put Massachusetts at odds with national trends,” he said in a statement. “These proposals offer a chance to course-correct.”
The 62F law, which was overwhelmingly approved by voters in 1986, has only been triggered twice since it was approved. The most recent rebates were in 2022, when the state returned $3 billion to more than 3.6 million taxpayers. But critics say the law is full of “loopholes” that allow state budget writers to restrict taxpayer refunds.
Backers of the ballot question said under the proposed changes, the funding formula would have authorized at least 24 rebates during that 40-year period.
Paul Craney, executive director of the pro-business Massachusetts Fiscal Alliance, praised the ballot questions and said they would deliver “broad based tax relief and send a clear message that voters are ready to rein in the Beacon Hill spending machine.”
“Rolling back the income tax to 4% would mean everyone gets a pay raise. It’s really that simple,” Craney said in a statement. “If you’re earning $50,000 a year, you just got a $500 raise. Families and businesses are being squeezed by high costs, and Beacon Hill has shown no interest in giving taxpayers a break.”
The proposals were among 47 initiative petitions submitted to Attorney General Andrea Campbell’s office for consideration by a 5 p.m. Wednesday deadline. Others include a proposal to bring back rent control, authorize same-day voter registration and require voters to show identification to cast ball in elections.
If Campbell certifies the questions, supporters must gather the signatures of 74,574 voters by mid-November, the first of several hurdles to make it onto the 2026 ballot.
Under the state constitution, the Legislature is also required to consider the initiative petitions before backers of the referendums conduct a second and final round of signature gathering.
Massachusetts voters overwhelmingly approved a ballot question in 2000 to cut the personal income tax rate to 5%. At the time the rate was 5.85%.
Two years after its passage, however, the Legislature outraged supporters of the rollback by freezing the personal income tax at 5.3% to plug budget shortfalls.
Lawmakers approved a process to reduce the tax rate if growth in the state’s annual revenue met certain benchmarks. But it took nearly two decades for the rate to come down to 5%, which happened in January 2019.
Republicans, including Senate Minority Leader Bruce Tarr, have filed bills every legislative session to lower the rate, but their proposals have been stymied in a Legislature controlled by Democrats.
Lawmakers who oppose dropping the rate say the state would take a major hit, with less money for schools, transportation and other needs.
Income tax collections represent more than 58% of the revenue used to keep state government running.