Corridor Nine Chamber Joins Tech Tax Opposition
The Westborough-based Corridor Nine Area Chamber of Commerce has become the latest chamber to oppose the state’s 6.25 percent sales tax expansion to computer software services.
The tax was approved by legislators as part of a transportation bill and took effect July 31. It was immediately controversial but business interests inside and outside the technology sector have spoken out against the legislation, which the state said would raise $161 million in new revenue annually.
“At this critical time when (Massachusetts) is trying to expand its technology industry and attract new IT business to the commonwealth, this IT tax discourages new business development as well as existing IT business expansion,” the Corridor Nine chamber said in today’s announcement.
It said the chamber has been against the tax since April and its officials had been in contact with state lawmakers urging them to vote against the tax.
The chamber “has members in the smallest IT business to the largest global corporations and all have been adamantly opposed to this tax for the last six months. This tax will suppress many of the exciting new technologies that have been developing in our innovation economy,” the chamber said. “Not only will technology companies need to negotiate with each client on what services are actually taxable, but with their increased costs due to the tax they will face the challenge of being non-competitive with technology companies in other states.”
Shortly after the tax went into effect, Florida Gov. Rick Scott used it to urge Massachusetts businesses to relocate to his state.
The chamber said it suggests “serious consideration in repealing this part of the transportation bill.”
Last week, the Marlborough Regional Chamber of Commerce voiced its opposition to the tax as well. Part of the reason for the decision to take a stance, the chamber said, was because of the small businesses it represents.
"Many of those businesses do not have the staffing or resources they must dedicate to analyzing and accounting for the tax they are now required to collect from their customers," the chamber said in a statement. "Several communications our member IT companies have had with the DOR still offered little solutions to the questions our membership has about what is taxed and what is not.”
Last week, Gov. Deval Patrick said he planned to meet with business and legislative leaders this week to discuss how to move forward and address industry concerns without jeopardizing revenue. State Sen. Karen Spilka, D-Ashland, has filed a bill to repeal the legislation.
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