BOSTON — The Small Property Owners Association (SPOA) is urging local lawmakers to oppose Boston Mayor Michelle Wu’s commercial and residential property tax increase.
The Massachusetts House met in an informal session on Wednesday and sent the bill to the House Committee on Rules and then to the Joint Committee on Revenue.
The tax bill would grant the Mayor’s office the power to temporarily shift the division of commercial and residential property taxes in response to projected economic upheaval.
Critics of the bill, like the SPOA, call her 8% increase to Boston’s Fiscal Year 2025 budget “egregious”, and say she should reduce excessive spending rather than increase taxes on small businesses and commercial tenants.
“Mayor Wu’s plan is to turn to the most beleaguered sector, commercial real estate, to make up the difference in her overly bloated budget,” said Small Property Owners Association Vice President Amir Shahsavari. “Why are Boston homeowners getting a free ride on the backs of the suburbs and commercial property owners? This is not a deal supported by SPOA and our members.”
Currently, Boston has the highest reliance on commercial property tax collections as a share of the city’s total revenue in the US, making up about 58% of the city’s revenues.
During a Boston City Council meeting last week, Councilor John FitzGerald claimed that property taxes will likely still spike when the legislation lapses in three years.
Under state law, cities and towns can tax commercial and residential property at separate rates, and push the commercial rate as high as 175 percent of what a single, unified rate would have been.
After making some concessions, Mayor Wu’s proposal includes a three-year plan with a 181.5% tax shift. In the two following fiscal years, she says the rate won’t exceed 180 percent, then 178 percent.
The Boston City Council passed this compromised version of the bill in conjunction with the Greater Boston Chamber of Commerce, NAIOP, Mass Taxpayers Foundation and Boston Municipal Research Bureau.
The tax rates will be finalized and approved in November, and certified in December by the Massachusetts Department of Revenue.
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