Millionaire's Tax vote to take place in May
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A vote on a nearly $2 billion tax proposal won't occur until May 18.
A vote on a nearly $2 billion tax proposal won't occur until May 18 at the earliest, after the deadline for candidates to submit signatures to appear on House and Senate legislative race ballots in this year's elections.
Lawmakers convened a Constitutional Convention, a joint session of House and Senate members, at 1:30 p.m. but recessed eight minutes later without taking up a citizen's initiative (H 3933) that would add a 4 percent surtax on incomes over $1 million.
The state's current income tax is 5.1 percent. According to Department of Revenue estimates, the surtax would be paid by roughly 19,500 filers representing half of 1 percent of all tax returns. Eighty-six percent of affected taxpayers would be married couples filing jointly, and 11 percent would be individual filers, according to the state's estimates.
Supporters of the measure, the same coalition that successfully passed an earned sick time voter law largely benefitting low-wage workers, last year gathered 92,617 certified signatures around the state to advance the proposal to the convention.
After breezing through the five items on the joint calendar preceding the tax proposal, Wednesday's Constitutional Convention recessed until May 18 at 1 p.m. That effectively delayed a tax vote until after the May 3 deadline for major party candidates to submit nomination papers for state office this year.
With the so-called millionaire's tax up next on the convention calendar, Senate President Stanley Rosenberg recognized Senate Majority Leader Harriette Chandler of Worcester who made the motion to postpone the convention until May 18. There was no debate on the motion and it passed on a voice vote.
Two days ago, Rosenberg voiced clear support for the proposal and said many of the Senate's working group members are pointing to a need for more state revenue.
"We need to rebuild the middle class in America and Massachusetts. We can't do it without the investment in education and transportation and housing and energy, and it's going to require us to shift the paradigm and change people's minds that they can and should support a change in the constitution to allow us to change the tax system so that those who earn the most pay the most," Rosenberg told the Greater Boston Labor Council's breakfast Monday morning at the Omni Parker House.
He added, "When we have the education plan and we have the transportation plan, we're going to have all the elements we need to be able to go out and argue for the fair share tax plan."
It appears lawmakers may tackle the amendment on May 18. It will be the first item on the agenda that day and the House on Wednesday adopted an order stating that the amendment will be the only matter considered at the May 18 convention and stipulating that amendments must be filed by 5 p.m. on May 12. The amendments will be filed with the Senate clerk, who is the clerk during joint conventions.
Amendment supporters say their proposal will address income inequality and generate $1.9 billion in new tax revenues to pay for investments in transportation and education. They have expressed confidence that they have the necessary 50 votes to advance their proposal to the 2017-2018 General Court and potentially, to the November 2018 ballot for a binding vote.
In addition to discouraging wealthier individuals from living in Massachusetts, opponents of the measure say it will tie the hands of future lawmakers by enshrining tax policy in the constitution, which is difficult and time-consuming to amend. Critics also say the move may lead to a graduated income tax structure in which higher earners are taxed at higher rates and lower earners at lower rates.
According to the Massachusetts High Tech Council, which is made up of tech companies, higher education institutions, law firms and other businesses, establishment of the higher tax bracket would place Massachusetts below only California and Minnesota as one of the highest top-tax rates among "peer technology" states. The council has also warned that General Electric -- whose move from Connecticut to Boston was touted by the mayor, the governor and the House speaker in their annual speeches this year -- was related to "anti-competitive state tax policies" in Connecticut.
Speaking before a crowd of business and government officials in Boston on Monday, General Electric CEO Jeff Immelt said Boston's "ecosystem" of ideas and entrepreneurs drove the company to move its headquarters here from Connecticut and said he was unconcerned about added taxes on big earners.
Immelt said the fate of the nearly $2 billion tax proposal would not have a bearing on whether he or other GE executives live in the Bay State.
"None of us earn that, no," Immelt joked, before professing a lack of concern about a tax question that opponents say would drive high earners from the state and drive up costs for small businesses. He said, "I think whatever happens happens, and will impact us just like it impacts everybody else. Really, I think, believe it or not, most days what we think about is how we can sell more jet engines and gas turbines and we let the rest of the chips fall where they may."
Gov. Charlie Baker, who has taken a firm stance as a candidate and as governor against new or higher taxes, has not staked out a position for or against the surtax amendment.
Asked before Wednesday's session when he anticipates the convention discussing the millionaire's tax, House Speaker Robert DeLeo said, "If not today, probably at the next session, whenever that will probably be held, sometime in May."
On a March 8 appearance on WGBH's "Greater Boston," DeLeo told host Jim Braude that he planned to vote in favor of the amendment.
"I will be, I believe. I think right now I've spoken to some of the folks who want to sit down and talk to me about the issue but I'm expecting that it will go to our vote in the Constitutional Convention and quite frankly just needing 50 votes, I'm pretty confident it will get the 50 votes," DeLeo said.
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