BOSTON - Officially it is called Massachusetts Ballot Question One but it is also known as” the millionaire’s tax”, “the fair share amendment” or” the tax hike amendment”. Voters are basically being asked if top earners in the state should pay higher personal income taxes.
Right now, Massachusetts has a flat tax system where all taxpayers pay 5 percent regardless of their income. Some voters say question 1 is not as simple as yes or no. “I think it is a little confusing about who it is going to impact,” said Caitlin Gillolly. “To me it makes sense to tax people who have the upper echelon of income,” said Maureen Kavanaugh.
Boston 25 News worked to try to clarify question one. Think of it this way. Right now, everyone pays a flat 5% tax regardless of income. If question one passes, Personal income up to 1 million dollars would still be taxed at 5 percent but all personal income more than one million dollars would be taxed an additional four percent on top of the five percent. So, everything more than one million dollars would be taxed at 9 percent.
Here is a break down from each side. “Yes” supporters say this change would generate an estimated 1.3 billion for the state in the first year. They also say the new revenue is solely for education and transportation. Andrew Farnitano is campaigning for, “yes on one”. “It won’t affect small businesses, it won’t affect retirement savings, it won’t effect 99 percent of people who sell their homes,” said Farnitano.
“No” supporters say this is the largest tax hike in Massachusetts’ history.
It gives politicians a blank check with no accountability, and it taxes the nest eggs of homeowners, retirees and small business. Dan Cence is helping raise awareness on, “no one one”. “If you sell your home or sell your small business. That all gets calculated together that year when you do your taxes,” said Cence.
The ballot question would also amend the Massachusetts Constitution to explain the two broad areas where this new tax money could be used in the categories of education and transportation. As you weigh your decision yes or no on question one. You should also take note of the makeup of the legislature because the legislature has the final say on where that money goes in each category. “These funds will go to transportation and education but then the funds already allocated for transportation and education will go back into the general fund,” said Cence. “Within those categories they could choose how much to spend on the T, how much to spend on replacing bridges, how much to hiring more teachers in classrooms or making public college more affordable,” said Farnitano
As for the so-called “one time millionaire”…say if someone sells their home or business for more than a million dollars. “Yes” says the standard deductions on 99 percent of these transactions would bring the taxable income below one million so the new tax would not apply. But “No” puts it in other terms. “Yes there are deductions, yes there are some folks that will do some tax avoidance but there are lots of people who can’t do that,” said Cence. You may need to ask your own accountant or tax consultant to determine how the change would impact your personal situation. But both “yes” and “no” do agree that if you vote their way it will benefit the state. “This is a real opportunity to make things better in MA,” said Farnitano. “Ultimately there is no guarantee, none, to any increase in funding for transportation or education,” said Cence.
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