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Archived: The Constitutional Amendment Tax Trap – Myths and Facts, Part 1

Posted on June 8, 2017

Editor’s note – Beacon HIll lawmakers will vote on Wednesday whether to place on the 2018 statewide ballot a proposed constitutional amendement that would impose a four percentage-point surtax (an 80 percent increase) on incomes of more than $1 million. AIM opposes the Constitutional Amendment Tax Trap and will look at the myths and facts surrounding the issue each day through next Wednesday.

Myth: Massachusetts has a revenue crisis and cannot support the cost of essential state government services without new taxes.

Fact: Massachusetts is one of the highest spending states in the nation on a per capita basis. Revenue collection and state spending in the commonwealth have increased significantly during the past 15 years. In that time period the state budget has doubled to more than $40 billion dollars, a growth rate that far outpaces inflation.

State Budget by Year 2017.jpg

Massachusetts has a spending problem, not a revenue crisis. Fiscal Year 2016 state revenues were $4.7 billion more than they were just five years earlier. In just the past five years, Massachusetts has increased the sales tax rate by 25 percent, raised the gas tax by 14 percent and adopted major policy changes, including casino gaming, designed to raise billions of dollars in new revenue each year. 

Revenue Trends-1.jpg

Myth: Massachusetts under-invests in its K-12 public educational system.

Fact: Massachusetts taxpayers support the seventh highest level of per-pupil spending in the country with an average expenditure of $15,000 per student each year. Massachusetts students perform better than their peers across the country, evidenced by the National Assessment of Education Progress (NAEP) eighth-grade student performance in Science (1st), Reading (tie 1st) and Math (tie 4th). (Source: MATTERS.mhtc.org; NCES)

Myth: Massachusetts under-invests in its transportation infrastructure.

Fact: Year after year, Massachusetts spends significantly more per mile on highways than nearly every other state in the country. Currently, Massachusetts spends more annually to build and maintain each mile of highway than 47 other states and four times the national average. Yet the condition of our roads and bridges is among the worst in the country.

The state Department of Transportation and MBTA acknowledge they are unable to effectively spend the capital funds already available to them.

According to Transportation Secretary Stephanie Pollack “for years the T [has been] leaving hundreds of millions on the table, failing to spend it on desperately needed maintenance and repair projects. The T is like a bathtub full of holes. Turning the spigot to let more water in is not going to fill up the bathtub. We need to fix the holes.”

Before any additional funds are expended, the state transportation system needs to adopt significant additional structural and management reforms and improvements.

State Highway Spending.jpg

(Sources: MATTERS.mhtc.org; the Reason Foundation; Boston Globe, 9.2.15)