Coalition Kicks-off Efforts to Defeat Income Tax Hike

Surtax doesn’t make sense with some folks.

Group seeks to communicate far-reaching negative consequences of proposed Tax Hike
Amendment on small businesses, retirees and large employers

BOSTON, MA – May 23, 2022 – The Coalition to Stop the Tax Hike Amendment (CSTHA)
today launched their campaign in opposition to the proposed constitutional income tax
increase, set to appear on the November ballot. The Coalition, comprised of over 80
small businesses, chambers of commerce, trade organizations, retirees and concerned
citizens, is urging Massachusetts voters to recognize the harm the constitutional
amendment would have on residents across the Commonwealth.

If passed, the proposed Constitutional Tax Hike Amendment would be one of the state’s
highest income tax increases in history, immediately imposing an 80% tax increase on
tens of thousands of Massachusetts residents. Members of the Coalition have united to
communicate to voters the damage this massive tax increase will have on our state’s
economy: threatening small business owners and resulting in even more lost jobs and
more people leaving Massachusetts.

“Now, more than ever, is not the right time to raise income taxes,” said Dan Cence,
Spokesperson for the Coalition to Stop the Tax Hike Amendment. “Proponents of the
amendment claim that it will raise taxes only on Massachusetts’ highest earners, but in
practice, it will harm hardworking families across the state. Massachusetts already has a
budget surplus of billions of dollars. We must work together to strengthen our economy
and ensure Massachusetts remains a place where small business owners can thrive.”

The amendment is not uniquely a tax on those individuals currently earning an income of
a million dollars annually. It will adversely impact small businesses, particularly those
who classify as pass-through entities or S-Corps and report their business’ revenue as
personal income while revenue is reinvested back into the business. It will also tax the
nest eggs of many small business owners and longtime homeowners whose retirement
depend on their longtime investments. A recent study found that over half of individuals
facing tax increases of 80% will be one-time million-dollar filers, meaning they were
never considered a high earner until a one-time event, for example the sale of their home,
land or business.

“There is nothing fair about subjecting small businesses who serve as the backbone of
the Massachusetts economy to a constitutionally locked-in income tax increase,” said
Chris Carlozzi, National Federation of Independent Business. “Not only does the income
tax hike reduce a pass-through small business’ ability to reinvest in their operation and
their employees, but it also taxes the owner at a higher rate when they seek to sell their
business and retire.”

The amendment would increase taxes on thousands of small business owners,
discourage investments in our communities’ small businesses and make it difficult for
recovering businesses to hire back workers amidst a national labor shortage. At a time
when the Commonwealth should be supporting its small businesses recover from the
devastating impacts of COVID-19, they would instead be left reeling from an
unprecedented and unwarranted new financial challenge.

“We’ve grown for 25 years in Massachusetts by reinvesting our earnings into our staff and
expanding locations creating new jobs with each restaurant we open,” said Mitch
Roberts, PR Restaurants. “Increased income taxes would devastate our ability to reinvest
in our teams and create good, new jobs.”

Because of a loophole in the constitutional amendment that says funds are subject to
appropriation by the State Legislature, there is no guarantee that money from this huge
tax would actually increase spending on education and transportation. The politicians
could just redirect existing funding for education and transportation to their own pet
projects, with no accountability.

The Coalition to Stop the Tax Hike Amendment is currently made up of the following
businesses and organizations who are against the constitutional tax increase, and
continues to grow every day:

126 Self Storage, Associated Industries of Massachusetts, AlerisLife Inc., Ballast Lane
Applications LLC, Boston Sword and Tuna, Brandon Landscaping, David Kindred Homes
Inc., Diversified Healthcare Trust, EFR Mechanical, IBC Corporation, Industrial Logistics
Properties Trust, M33 Growth, MA High Tech Council, MA Seafood Collaborative,
National Federation of Independent Businesses, Norfolk & Dedham Group, North Central
MA Chamber of Commerce, Office Properties Income Trust, Optikos, Pioneer Institute,
PR Restaurants, Retailers Association of Massachusetts, Service Properties Trust, Seven
Hills Realty Trust, Sonesta International Hotels Corporation, Springfield Chamber of
Commerce, The RMR Group, TravelCenters of America Inc., Trudeau Construction,
Western MA Economic Development Council and Westside Finishing Co. Inc.

Learn more about the Coalition to Stop the Tax Hike Amendment at:
StoptheMATaxHike.com

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Contact:
Dan Cence
617-777-8974
dcence@issuesgroup.com