By Bob Katzen
The Raise Up Massachusetts Coalition announced that the State Department of Revenue certified that Massachusetts collected more than $3.1 billion in revenue from the state’s 4 percent surtax on millionaires over the first ten months of the state’s current fiscal year. They said that is a 20 percent increase over the $2.5 billion collected at that same point last year.
The revenue is generated by the 2022 voter-approved constitutional amendment, known by supporters as the Millionaire’s Tax and the Fair Share Amendment, which imposes an income surtax of an additional 4 percent, in addition to the current flat 5 percent one, on taxpayers’ earnings of more than $1 million annually.
“Nearly four years after voters passed the Fair Share Amendment, it’s still surpassing expectations,” said Raise Up Massachusetts spokesperson Andrew Farnitano. “The skeptics who said multi-millionaires would flee for other states rather than pay their fair share are being proved wrong. The ultra-rich are clearly staying in Massachusetts and paying more in taxes, leading to the tax’s massive overperformance relative to initial projections.”
Farnitano continued, “Thanks to this windfall paid for by the richest 1 percent, we’re allocating billions of dollars to improve our public schools, colleges, roads, bridges and public transportation. We’re finally fixing the T and rebuilding crumbling bridges across the state. We’re delivering record funding to local public schools and colleges and increasing access to affordable childcare. And Fair Share-funded programs like universal free school meals, free community college and free buses are making a real difference in the cost of living for Massachusetts families.”
“The latest claims from Raise Up Massachusetts ignore the broader economic reality facing the commonwealth,” said Paul Craney, executive Director of the Massachusetts Fiscal Alliance. “While revenues from the surtax may be higher in the short term, that does not mean the policy is leaving our state on a solid economic footing. Massachusetts has seen above average unemployment compared to national trends, alongside a growing reputation for being far less economically competitive than it had been and downright hostile to employers.”
Craney continued, “In the last several months alone, we’ve witnessed a steady stream of high-profile business closures, relocations and expansions happening elsewhere, which should concern anyone focused on long-term growth. At the same time, Massachusetts continues to experience a significant outflow of residents and wealth to lower-cost, lower-tax states, a trend greatly exacerbated by this surtax.”
“Temporary revenue spikes should not be confused with sustainable economic health. Policymakers should be asking whether these policies are strengthening the state’s long-term competitiveness or simply extracting more in the short run. Massachusetts cannot afford to ignore the warning signs while celebrating a revenue surge that will inevitably prove fleeting.”