By Bob Katzen
Senate 7-32, rejected an amendment that would exempt from the state’s 5% income tax, up to $12,500 of income from overtime and up to $25,000 of income from tips,
Amendment sponsor Sen. Ryan Fattman (R-Sutton) said his amendment will put more money back in the pockets of hardworking individuals including restaurant workers, construction workers and countless other individuals who are doing everything right. He said they are working overtime, picking up extra shifts, relying on tips and yet they feel like they’re falling further behind because the cost of living has exploded and housing prices have climbed beyond the reach of many first-time homeowners. He noted that tipped workers earn their income by providing excellent service and putting in long hours and argued that if you work more, you should keep more of what you earn.
Sen. Mike Rodrigues (D-Westport) said that this amendment is responding to something real because service workers face the same cost of living pressures as every other resident in the state and deserve a break. But he added that the Senate should not be adopting this amendment at this time because there are serious unanswered questions like what separates voluntary overtime from mandatory overtime and how are tipped pools treated? He noted that the Legislature has already created better ways to help workers by increasing the Earned Income Tax Credit to 40 percent of the federal credit, expanding the child and family tax credit and raising the senior circuit tax break.
“It’s unfortunate Massachusetts lawmakers did not give this tax cut to working people,” said Paul Craney, executive director of the Mass Fiscal Alliance. “Many retail workers benefit largely from tips and exempting the state income tax to their tips which mean a five percent raise for many retail workers. The Massachusetts state Senate missed a great opportunity to help keep more money in the pockets of working people.”
(A “Yes” vote is for the amendment exempting some overtime and tips income from the income tax. A “No” vote is against the exemption.)
Sen. Patricia Jehlen No