Served with a Twist – Tax Reform in Massachusetts

We watched with interest as Massachusetts Governor Deval Patrick laid out his ambitious plans for improving the state’s physical and educational infrastructure and a revenue plan to fund it based on increasing the state’s income tax.   

 
The twist that few had anticipated was a reduction in sales tax in exchange for an even larger increase in the income tax than many had forecast.  Prior to his speech, most business groups had showed little support for a general income tax increase, preferring instead discrete tax increases e.g gas tax increase to pay for infrastructure. This was borne out by a recent survey of Alliance members, in which less than a quarter of those responding supported a general income tax increase. 
 
The challenge now to the Alliance (and others with a stake in this debate) is how best to respond to the Governor’s proposal in a way that best moves forward our vision of a sustainable economy. This will be a key topic for the Alliance’s Responsible Government Initiative and other Alliance leaders over the next week, and we welcome your thoughts and input, whether in the comments below or by sending an email to our senior policy advisor, Kelly Bovio.