When voters throughout the Commonwealth cast their ballots in the state midterm elections Tuesday, Nov. 8, they will decide on four different questions. Here is everything you need to know about Question 1, whose proponents call the “millionaire’s tax,” and whose opponents call the “tax hike amendment.”
A vote “yes” on Question 1 would amend the state constitution by establishing an additional four percent income tax on taxable income in excess of $1 million. The amendment mandates that revenue collected from the increased tax rate be allocated toward public education, and the repair and maintenance of roads, bridges, and public transportation.
Supporters of Question 1, which is also referred to as the “Fair Share Amendment,” argue that the tax increase would not affect the majority of Massachusetts residents, and provide revenue for needed public transformation and infrastructure.
Those in opposition argue that the amendment, which would include an additional four percent tax on one-time income such as home sales or small business revenue that would otherwise be re-invested, would negatively impact not just the rich, but the upper-middle class.
In April, Lynn City Council voted 8-1 to pass a resolution, introduced by Councilor at-Large Brian LaPierre, supporting Question 1.
“You have to make more than a million dollars to ever be affected, per-year income, not assets. Not your house, not your jewelry, not your fine china, not your artwork. This is simply for income in excess of a million dollars in income per year, and then it’s four percent on every million that you make after your first million, so it’s really millionaires stepping up and paying a little more,” LaPierre said in an October interview.
LaPierre said that although some small businesses might go over one million dollars in annual income, the tax will likely not impact anyone in the City of Lynn. He said that the tax, without negatively impacting Lynn residents, will fund necessary improvements to public education and transportation.
“They’re not taxed on that first million, that first million is a gift. They stay right at the same tax that you and I pay in the state which is five percent of our income,” LaPierre said. “We don’t have a millionaire residing in the city of Lynn that earns more than a million dollars a year. So no one in our city will be impacted by this tax if it goes through on Nov. 8. As an elected official in Lynn, I have to watch out for all constituents, but this favors the vast majority of regular, average citizens who want to improve their public education and public transportation statewide.”
Ward 2 City Councilor Rick Starbard voted in opposition of the resolution. In an interview last month, Starbard described the amendment as being “divisive.” He said that although he does not personally fit into the impacted income bracket, he believes that the tax bump might deter free agents from joining Boston sports teams.
Starbard also said that he opposes the proposed amendment because he thinks it will unfairly tax small business owners hoping to reinvest their profits.
“It makes Massachusetts less competitive to surrounding states. […] People who are sports fans who want to see free agents brought to Boston teams, when you’re bringing in somebody with these high contracts, that impacts them as well,” Starbard said. “This is just another, as I said, divisive tax the rich scheme, and it’s going to seriously impact small businesses, and Massachusetts ability to be competitive.”
Governor Charlie Baker, in a press release published Thursday, urged his constituents to vote “no” on Question 1, arguing that it would negatively impact homeowners and businesses. Baker acknowledged the state’s need to invest in transportation and education, but stated that he did not consider the proposed amendment to be the best solution.
“Hardworking residents across the state, including farmers, restaurant owners, and seniors – many of whom would never be considered ‘millionaires’ – will be asked to pay an enormous tax increase on the nest eggs they have spent decades building. And because the tax created by Question 1 will become enshrined in our state constitution, there is no easy fix for these unintended consequences,” Baker said.
Currently, those bringing in $1 million in income a year are taxed at five percent. A “yes” vote on Question 1 would increase the tax rate on income exceeding $1 million to nine percent.
At a debate panel hosted by the Berry Institute of Politics at Salem State University, President of the Massachusetts Teachers Association Max Page argued that the amendment would serve as an anecdote to tax cuts, which, he said, left public institutions underfunded for decades.
“Why is it that one of the wealthiest states in the nation doesn’t have enough to provide for its public schools, public colleges, universities and transportation? Why is that happening? Part of it, fundamentally, is that we cut taxes more than any other state in the nation in the past 20 years,” Page said. “It’s partly about tax fairness. And then what’s key is that it is constitutionally required that the money that’s generated, $2 billion or more, will be dedicated to public schools, public colleges, especially affordability of public higher education, roads, bridges, and transportation.”
In response to Page’s argument, Spokesperson for the Coalition to Stop the Tax Hike Amendment Dan Cence argued that the amendment would negatively impact homeowners in the Commonwealth who wish to sell their houses.
“It’s the middle class in Massachusetts, their greatest asset is the equity at home or in business or in their foreign property, and when they go to retire, or they go to pass that down to their children, and they go to sell, those people will be negatively impacted,” Cence said.
Anthony Cammalleri can be reached at [email protected]
