2.9 BILLION IN TAX RELIEF PENDING (H 5260)

By Bob Katzen

Governor Charlie Baker filed a $1.6 billion supplemental budget to close out the books on fiscal year 2022. A key section sets aside $2.9 billion of the state’s projected surplus to be returned to taxpayers based on the recent “discovery” of 62F, a 1986 law approved by the voters. That law requires that tax revenue above a certain amount collected by the state go back to the taxpayers. It is estimated that the 1986 law would return $2.9 billion in fiscal year 2022 revenue to Massachusetts taxpayers.

Last week, the Department of Revenue informed Auditor Suzanne Bump that it believes that $2.9 billion is required to be returned to taxpayers. If the auditor certifies that figure by a Sept. 20 deadline, the money will be returned to taxpayers. Baker’s office said that even with the money being returned to taxpayers, the state will still have a fiscal year 2022 surplus of $2.3 billion.

“The more time the auditor allows for the certification process, the more time she allows for outside influence by those who do not want credits sent back to the taxpayers,” said Paul Craney, spokesperson for Massachusetts Fiscal Alliance. “There is also a very strong argument to be made that since the speaker and Senate president failed to pass their tax relief package, taxpayers need this money as soon as possible to help with the rising cost of inflation. Back to school shopping is well underway and soon enough families across the state will be thinking about rising home heating costs. They need this money more than ever.”

“In 1986, Citizens for Limited Taxation (CLT) put forth this ballot question with the expectation that Massachusetts taxpayers would one day need this law,” said Chip Ford, executive director of Citizens for Limited Taxation. “Any required credit should not be delayed as a refund next year, as the original intent when CLT drafted it was to get the money back to the taxpayers expeditiously. With inflation still surging, delay will only devalue the amount returned to the taxpayers.”

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