Question 1 is the most reckless proposal ever to reach the Massachusetts ballot. Not a single Republican or Democratic candidate for statewide office or member of the state legislature supports this extreme measure, which would throw the finances of state and local governments into chaos and inevitably lead to huge increases in property and sales taxes.
The income tax is the state’s principal revenue source and has financed a wide variety of state and local programs for more than half a century. Question 1 would eliminate $8.5 billion, or 60 percent, of annual tax revenues and radically reduce funding for local schools, higher education, health care, public safety, human services, infrastructure and other critical state and local services.
Without state aid to education, schools in poor urban districts would have to close their doors, including 14 communities with more than one-fifth of the students in the Commonwealth that rely on state aid for at least 75 percent of their school budgets. Schools in virtually every other district would also face severe financial difficulties.
If state spending for health care were eliminated, almost one million Massachusetts low-income, disabled and elderly residents, including more than 400,000 children, would lose their prescription drug and other health coverage, and over 30,000 senior citizens would lose their nursing home care.
Moreover, Question 1 would inevitably lead to increases in other taxes. Making up the $6.3 billion required just to meet the state’s obligations to local schools and Medicaid would necessitate an almost 80 percent increase in local property taxes. Making up the same amount through the sales tax would require at least a tripling of the current rate of five percent to 15 percent.
Proponents falsely claim that three million working people in Massachusetts will each get back $3,000 annually as a result of Question 1. Almost half a million tax filers have such low incomes that they owe no state income tax and would not benefit at all from Question 1, and more than 250,000 — the so-called “working poor” — would actually lose the state tax refunds they now receive as a result of the earned income tax credit. In addition, more than a million tax filers — a third of the total — would get back only $175 on average, the amount of taxes they now owe, not the $3,000 touted by proponents.
Despite the seductive claim of equal benefits for every taxpayer, 45 percent of the total tax relief under Question 1 would go to the six percent of tax filers with annual incomes of $150,000 or more.
The proponents of Question 1 also fail to point out that residents of the nine states that impose no income tax pay much higher property and sales taxes.
The closest of these states, New Hampshire, has the highest property taxes in the nation as a percent of personal income, and the second highest per capita. All of the other states with no personal income tax, except oil-rich Alaska, have higher sales taxes than Massachusetts. In fact, five of these states are among the top ten in sales tax per capita, while Massachusetts’ sales tax burden currently ranks near the bottom.
Question 1 would lead to dramatically higher property and sales taxes, create wholesale fiscal and political chaos and cause further damage to the Massachusetts economy. It deserves to be soundly defeated.
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