Elected Officials and Local Activists gathered under raindrops on Saturday Morning for a city-wide canvass for the Question 1 Fair Share Amendment.
Sen. Will Brownsberger and Steve Owens spoke to the history, extensive support and promise of the Fair Share Amendment to bring a stable new funding source for education and transportation. City Councilors Caroline Bays, Nicole Gardner, Vinnie Piccirilli John Gannon, Tony Palomba, and Lisa Feltner along with School Committee Member David Stokes, and Library Trustees Maja Young and Sara Keary took part in the canvass. Over 30 residents set out to knock on doors and pass along the Vote Yes on Question 1 message.
Question 1 is an amendment to the State Constitution that will allow the state to levy an additional tax of 4 percent on any personal income over $1 million dedicated to schools and transportation. Learn more about it at Why The Fair Share Amendment | Fair Share Amendment for Massachusetts (fairsharema.com).
In addition to attending elected officials, the canvass was supported by State Senator John Lawn; City Council President Mark Sideris; City Councilors John Airasian and Emily Izzo; School Committee Members Kendra Foley, Lindsay Mosca, Amy Donohue, Jessica Middlebrook, and Lily Layman Reed; and Library Trustees Leanne Hammond, Teddy Kokoros, and Rose Mary Su.
The canvass was organized by Watertown4Fair Share, a group with members from Watertown Faces Climate Change, Progressive Watertown, and school advocates.
Ann Munson
Caroline Bays
Deborah Peterson
Lani Gerson
Rachel Kay
Rita Colafella
This is an important issue that once again people need to do their own homework on before voting. You may think this tax will only apply to millionaires, but YOU, in fact, may in one year be a MILLIONAIRE.
With the values of housing in Watertown increasing, more houses than ever are selling for well over $1 million. If you have owned your home for a long time and decide to sell it and move, you have a limited amount of capital gain exclusions, especially if you are single, and you could be hit by an extra 4% of taxes on your income for that year.
This extra 4 percent tax could also apply to a small business that decides to sell after serving our communities for a long time. And if you’ve held any long-held securities to make it through your retirement years, this could affect you if you cash them in.
Another fact is that many millionaires can and may decide to move out of MA. Look at how people in CA and NY and baling out of their states because of excessive taxes. They are moving to states that tax a lot less than MA and this may be the incentive to force this to happen here. If they take their businesses, then they also take many jobs with them.
There was an argument column in the Boston Globe on October 2 talking about some of these issues. It says, “Contrary to some claims, the proposed amendment does not guarantee that the higher taxes will be spent on education and transportation. The language makes clear it is not legally binding on future Legislatures. Supporters may hope continued political pressure will force legislators to spend it on those programs, but there’s no certainty they will do so. The Center for State Policy Analysis has estimated that as much as 35 percent of the estimated revenue from the tax will be avoided by people leaving the state or changing some of their decisions as investors and business owners.”
This 4 percent increase is actually a 9 percent tax rate on anything over $1 million and is an 80 percent increase over the current rate of 5 percent that we all pay.
If we lose ‘those’ millionaires, we will lose more of our tax base and that often causes legislatures to raise taxes on the rest of us to make up for the shortfall. Once the door is opened to increased taxes on one group, it makes it easier to start creating other incremental taxes on others. I personally think the 5 percent flat tax should remain as is.
As the argument article says, “The millionaires tax proposal on the November ballot is an AMENDMENT to the state’s Constitution. It can only be repealed or amended by a future amendment – a process that can take MANY YEARS.” Do we want to lock ourselves in on such tax increases trusting future legislatures to fix it? We are already known as Taxachusetts.
I have heard over the years that once these types of tax increases are put in place, the actual taxes allocated to specific funds go away and go into a general fund where they can be disbursed as the legislature deems fit. If that ends up being true, the anticipated dollars for schools and transportation won’t be there. Remember the promise to take down the tolls on the Turnpike once it was finished so many years ago? That never happened!
From, I believe, a 1986 law that required excessive tax money be returned to we, the people, the legislature was dragging their feet on whether they could circumvent the law and not give us the money due us. Gov. Baker forced them to adhere to the law. The legislature seems to always want more money to spend and it is often spent foolishly and incompetently.
I don’t pretend to have all the answers on this issue, but I urge you to do some checking on your own so that you make informed decisions when voting for Ballot Question 1 and the other ballot questions, INCLUDING BALLOT QUESTION 4 THAT NEVER MADE IT INTO OUR RED VOTER BOOKS.
Yup, watched on Jim Braude last night, had the pro & con people on. Not as simple as it sounds. Definitely do your homework before voting!
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The wealthy are very astute at preserving what they earn and have the financial means to own and live at multiple properties where they can declare as primary residence. They also have the resources to receive the very best financial and tax planning assistance to minimize their income tax exposure. If this passes, I would bet that the first year will be the peak in the new tax revenue that it generates, and then decline each year after that. The planned increases in spending associated with this new tax revenue will only go up over time. Lots of newly created positions with salaries, healthcare, PTO, and pensions to fund. Increased spending with a decreasing revenue can only result in only one thing and that’s a deficit. If that happens, will the new spending be cut back? Not a chance! Taxes for all and especially the working middle class will then go up to cover the growth in spending that this will bring. That’s what always happens. I am voting NO!
Let’s not be afraid to do some good.
Why should millionaires embrace Fair Share?
We’ll all benefit from better schools, colleges, roads, bridges, and public transportation. The 1% of Massachusetts residents who earn over $1M (20,000/week) can pay a little more, so we can recover from the pandemic and rebuild a Massachusetts economy that’s stronger than ever. WE ALL DO BETTER WHEN WE ALL DO BETTER. This is why all our elected officials have come out to support Question 1.
What about the sale of my house?
Very few people have homes that will net them $1M after they deduct their original purchase price, the cost of any improvements and the up to $500,000 deduction for owners. Last year, in Watertown, only 5 houses sold would have triggered this law. Statewide 900 out of 100,000 homes sold, or less than 1%, produced a gain of more than $1 million.
What about small businesses?
No business would have to pay this tax. Only income reported on your personal income is taxed. A small group of Massachusetts businesses are organized to “pass through” their income to an owner’s personal income. These can be reorganized as independent businesses. Like house sales, any investments and original costs can be deducted. Only 2.6 percent of tax filers with pass-through income have income over $1 million, and many in this small group are not primarily engaged in operating small businesses. Small business benefit from good transportation and education.
Will the legislature spend on what they promise?
Yes! As an amendment to the constitution, there is binding text that dedicates this money for school and public transportation. All state expenditures are always subject to appropriation. These are the two biggest gaps in our budget and there is a strong consensus in Massachusetts Legislature around what needs to be done and not enough money to do it. Let’s give them the ability to do what we know needs to be done.