SJC asked to weigh in on House-Senate tax dispute
The Massachusetts House on Friday asked the state's highest court to weigh in on whether the Senate abided by the constitution in proposing to freeze the income tax rate and add a tobacco tax through its version of the state budget.
In a sparsely attended Friday morning session held only hours after the Senate approved its budget, the House adopted a Speaker Robert DeLeo order to seek an opinion from the Supreme Judicial Court.
"Grave doubt exists as to the constitutionality" of sections of the Senate budget, the House orders says.
DeLeo and Senate President Stanley Rosenberg disagree about whether the House's budget proposal to increase a conservation land tax credit gave the Senate the authority to change tax laws in its budget.
The Senate budget would remove laws aimed at ratcheting down the income tax rate toward 5 percent if economic benchmarks are met. In addition to freezing the income tax at 5.15 percent, the budget would increase the personal exemption for income taxes and boost the state's earned income tax credit. A provision added by the Senate Thursday night would add another tax onto flavored cigars and smoking tobacco.
"Money bills," which involve the taking of property, usually in the form of taxes, are required to originate in the House and DeLeo has maintained the House budget was not a money bill. Rosenberg disagreed, citing the conservation land tax credit provision, and the Senate took advantage of the opportunity to raise taxes.
"Heard in the Senate chamber − 'Wow Speaker DeLeo is really going to love the cigar tax,'" Sen. Jamie Eldridge tweeted Thursday night as the Senate wrapped up its budget.
"The budget passed unanimously by the House in April contained no new taxes or any other provisions that would make it a so-called 'money bill' − thereby triggering the Senate's ability to add tax increases," DeLeo said in a statement Friday. "The Senate clearly disagrees with this and has included provisions in its budget that would, among other increases, effectively raise Massachusetts' income tax rate."
Sen. Linda Dorcena Forry, a Dorchester Democrat, said in an interview she was "a little bit surprised" to see the House had taken the action, and said the earned income tax credit helps with "lifting people out of poverty" and freezing the income tax would alleviate pressure on the budget.
Gov. Charlie Baker deflected when asked if he would veto the tax provisions, saying, "Remember, there's a conference committee that we have to go through and a whole bunch of other things here."
The governor said he hopes the court would "rule pretty quickly on this," and said there is value to disagreement between the branches.
"I think there's value in a sort of legitimate back and forth between and among the players. And we certainly have that at this point in time on a number of issues," Baker said at a news conference Friday afternoon. "But I would also say that it's a democracy with a small d. That kind of comes with the job description, I think, for all of us."
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