Millionaire tax hearing to take place
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Human services organizations that have contracts with the state are pushing for legislation that would allow them to join the state's Group Insurance Commission in order to save on healthcare costs.
A tax hike proposal that would directly affect only the highest earners will have a hearing Tuesday, one stage of what could prove to be a more than three-year process culminating on the 2018 ballot.
Rep. Jay Kaufman, a Lexington Democrat who is House chairman of the Revenue Committee, said the petition will definitely be reported out of committee and he believes the 16-member committee is "likely to report it out with a favorable vote." An "active, enthusiastic supporter" of the proposal, Kaufman said he has "little if any doubt" that the proposal will clear a constitutional convention this session to advance it to the 2017-2018 constitutional convention.
Kaufman's Senate co-chair, Michael Rodrigues of Westport, said he supports putting the issue before voters though he has not formed an opinion on it himself. Rodrigues said proponents and opponents are likely to testify at Tuesday's hearing, though he couldn't say whether anyone who would be directly affected by the proposal - those who earn in excess of $1 million per year - would offer testimony.
"They're invited to and we would welcome their testimony. I don't know if I even know of any millionaires. I can tell you I can't think of any from my city of Fall River," Rodrigues said. (Fall River's population of nearly 89,000 includes three millionaires, according to a Boston Business Journal database of tax filers reporting income of at least $1 million in 2013).
While proponents say the measure amending the constitution's requirement of a flat income tax rate would be more equitable and provide needed funds for education and transportation, opponents contend it would prompt a flight of employers and their businesses from Massachusetts. The amendment (H 3933) would expand upon an earlier amendment authorizing an income tax, establishing a four percent surtax on incomes over $1 million. The current income tax rate is 5.1 percent and it is expected to fall next year to 5.05 percent.
The coalition backing the proposal, Raise Up Massachusetts, estimated the new surtax would affect 14,000 individuals, generating between $1.3 billion and $1.4 billion, though the Department of Revenue estimated a higher yield of $1.6 billion to $2.2 billion with $1.9 billion as the median. If the measure is placed on the calendar for a joint session of the House and Senate and lawmakers take it up, it would require 50 votes from the 200-seat Legislature to advance it to next session.
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