A ballot initiative to raise the income tax on the wealthiest Massachusetts residents is being reintroduced. The measure, which was rejected by the state’s Supreme Judicial Court last June, sought to add a 4 percent surtax on the portion of an individual’s income exceeding $1 million.
The so-called “millionaire tax” received strong support from progressive activists, labor unions and Democratic groups in the state. The organization Raise Up Massachusetts gathered more than 150,000 signatures in support of the tax, enough to make the Legislature act on the measure.
In 2017, a joint constitutional convention of the House and Senate voted 134-55 in favor of the measure. However, it was ruled unconstitutional on the grounds that the tax itself and what it was proposed to fund — transportation and education — were not “mutually dependent,” thus violating Article 48 of the state’s constitution.
Now, the revived ballot initiative is in the form of a legislative amendment in order to change Article 44 of the state constitution. This article allows only for flat, uniform income taxes to be levied, so everyone’s income in the state of Massachusetts must be taxed at the same rate.
Critics of the “millionaire tax” may argue that this new revenue stream would be unstable because of fluctuations in wealthy people’s incomes. Moreover, opponents might say the tax will cause entrepreneurs and businesses to avoid investing and operating in the state.
Yet Massachusetts only ranks 18th in the country in terms of overall tax burden, considering property taxes, individual income taxes, and sales and excise taxes, according to the personal finance website WalletHub.
The legislature must also be concerned with the hard truths of the current inequality that exists in the state. According to the career website Zippia, Massachusetts has the sixth highest level of income inequality in the country.
The current income tax rate in Massachusetts is 5.1 percent, and the Bay State is just one of only seven other states that have flat income taxes. While a flat income tax may appear to be equitable, it certainly isn’t. The wealthy can more easily absorb the income tax compared to those who may be living paycheck-to-paycheck.
A four percent surcharge on income that’s more than $1 million does not go far enough in making the state’s income tax more progressive. A person who earns $30,000 should not pay the same income tax rate as a person who earns $900,000.
In its current form, the proposed constitutional amendment would make strides to increase government revenue, so the state can invest more in infrastructure and public education.
But the earliest this amendment could be put on the state ballot is 2022, and frankly Massachusetts cannot wait three more years to start curbing income inequality. Beacon Hill should reconsider this amendment and consider implementing more progressive taxation levels to make Massachusetts a fairer society.
