Massachusetts State Income Tax Repeal Initiative

The State Income Tax Repeal, also known as Massachusetts Question 1, was one of the 2008 ballot measures that appeared on the November 4, 2008 ballot in the U.S. state of Massachusetts.^[1] Voters were asked whether or not they approved of the proposed measure which, if it had passed, would have ended the 5.3% income tax in Massachusetts on wages, interest, dividends and capital gains. Ultimately, Massachusetts voters defeated Question 1 by a wide margin, with approximately 70% opposed versus 30% in favor.

Specific provisions

This proposed law would:

• Reduce the state personal income tax rate to 2.65% for all categories of taxable income for the tax year beginning on or after January 1, 2009.
• Would eliminate the tax for all tax years beginning on or after January 1, 2010.
• The personal income tax to which the initiative applies is the "income received or gain realized by individuals and married couples, by estates of deceased persons, by certain trustees and other fiduciaries, by persons who are partners in and receive income from partnerships, by corporate trusts, and by persons who receive income as shareholders of “S corporations” as defined under federal tax law."
• The proposed law would not affect the tax due on income or gain realized in a tax year beginning before January 1, 2009.
• The proposed law states that if any of its parts were declared invalid, the other parts would stay in effect.

Supporters of the income tax repeal

The official proponent of the measure is the Committee for Small Government. Michael Cloud and Carla Howell lead the committee.^[2]

Initiative supporter Michael Cloud believes that the measure will lower the budget from about $28 billion to $17 billion which is approximately the size of the 1995 state budget.^[3]

Polling shows that 46 percent of those asked support the measure before hearing any of its details, and 40 percent still supported it after hearing about the measure in depth.^[4][5]

Arguments In Support of Question 1

• Total state government spending is in excess of $47.3 billion. Total state revenues are in excess of $47.3 billion. The income tax is less than 27% of the state government's revenue.
• Municipal (city and town) government spending is more than $22 billion on top of state government spending, bringing total government spending in Massachusetts to nearly $70 billion. The income tax is only 17% of total government spending.
• Waste, fraud and abuse as exposed in the media nearly every day are only the tip of the garbage heap: When polled, voters estimated government waste at 41%. An informal poll of government employees estimated waste at 50%.
• State politicians have not kept faith with their promises to taxpayers. The Massachusetts State Legislature blockaded a ballot question approved by the citizens of the commonwealth in 2000 that would have reduced the state income tax to 5%.
• 3.4 million Massachusetts taxpayers would get back an average of $3,700 each annually.
• People would find the Bay State a more attractive place to live, work, invest, and raise families.
• From 1991-2007 more than 550,000 people moved out of Massachusetts, ranking the commonwealth as the 2nd worst state in the US in terms of population loss.

Funding

According to campaign finance reports, as of November 1, 2008 the Committee for Small Government has raised approximately $385,000 since creation and has $14,131.72 cash left. They also have about $80,000 in outstanding liabilities.^[6]

as of August 15, 2008, Ms Howell and Mr Cloud have paid themselves almost $200,000 from committee donations for "consulting fees" over the last 6 years for services rendered to the their own campaigns while soliciting donors for additional contributions because the campaign was out of funds.^[7][8][9]

Earlier attempt to repeal income tax

The Committee for Small Government advanced a similar initiative, called the Massachusetts End the Income Tax initiative in 2002. That measure did not pass and received 885,683 votes, or 45.3 percent.^[10]

Editorial Support

Stephen Moore of the Wall Street Journal: “The forces of the tax-and-spend status quo will descend on this initiative like British troops after the original Boston tea party, but somebody has to make an effort to stop the relentless growth of government.”

Steve Forbes of Forbes magazine: “This is an attack on political establishments there and throughout the U.S. that routinely put their own interests above those of their constituents: lavish government pensions with payouts that would bankrupt private companies; resistance to genuine reform in Medicaid spending, which has become the biggest item on virtually every state's budget; ever more pork-barrel spending; and ever more obsequiousness to rapacious special interests. Bay State voters – go for Proposition 1.”

Opposition

Funding

According to campaign finance reports, as of October 15, 2008 the Coalition for Our Communities, the organization opposing this tax cut, had raised over $5 MILLION—99.8% from teachers' and other government sector unions.

Individual opponents

Michael Widmer, president of the Massachusetts Taxpayers Foundation,^[11]

Gov. Deval Patrick^[12]

The Selectman in the town of Wayland voted unanimously to oppose the initiative.

State Rep. Tom Conroy, D-Wayland^[13]

Organizations against the measure

Coalition for Our Communities, an organization created by the Massachusetts AFL-CIO that reportedly has $1.34 million with which to mount an effort to defeat the measure. The Coalition's funds are derived mainly from unions, including $750,000 from the National Education Association.^[14][15] The group also received $250,000 from American Federation of Teachers Solidarity Fund. Both the NEA and the AFTSF are based in Washington, D.C.^[16]

Editorial opposition

The Boston Globe has officially asked voters to vote "no" on Question 1.^[17]

Arguments against Question 1

• Massachusetts would lose about 40% of its income and would deal an $11 billion blow to the state, which would have adverse effects throughout state government.
• It would put education, health care, public safety and infrastructure at risk.
• Mass Municipal Association, representing all 351 towns, estimates cuts in local aid as approximately $3 Billion.^[18]
• Proponents have not specified any specific cuts that could be made that approach 40% of state revenue.

Funding

According to campaign finance reports, as of November 1, 2008 The Coalition for Our Communities has raised approximately $6,625,000 since creation and has $117,270.95 cash left. They also received about an additional $650,000 in inkind donations from unions such as donated staff, supplies, postage etc.^[19]

History of petition drive and blocking allegations

The proponents submitted about 100,000 signatures to the Massachusetts Secretary of State for the first phase of signature collection. 76,084 of those signatures were determined to be valid, with a requirement that 66,593 must be valid for the initiative to proceed to the next step.^[20] The next step was for the Massachusetts State Legislature to take up the measure. They declined to pass it by the first Wednesday in May 2008, meaning that the proponents had to collect an additional 11,099 valid signatures by June 18, 2008. On July 3, it was announced that 15,913 additional certified signatures had been filed, making the measure extremely likely to appear on the ballot.^[21][22]

The Massachusetts Teachers Association who's mailing address is the same as the "Committee for our Communities", admitted in December 2007 that it had made phone calls to people who signed the petition to place the income tax repeal on the ballot, inquiring about whether their signature was valid. The calls were made from a group identifying itself as the "Committee for our Communities".^[23]

Results

State Income Tax Repeal Initiative[24][25]
Choice	Votes	Percentage
No	2,070,699	69.37%
Yes	914,420	30.63%
Valid votes	2,985,119	96.20%
Invalid or blank votes	117,876	3.80%
Total votes	3,102,995	100.00%
Voter turnout	73.52%
Electorate	4,220,488

See also

• Massachusetts 2008 ballot measures

References

1. ^ Berkshire Eagle: "Income tax repeal gets 1st ballot slot," July 11, 2008
2. ^ WSJ Online: "Boston Tax Party," Aug. 5, 2008
3. ^ Boston Globe: "4 ballot petitions clear 1st obstacle," Nov. 24, 2007
4. ^ The Colombian: "Washington View: Another tea party brewing in Massachusetts," Aug 12, 2008
5. ^ American Spectator: "Taxachusetts, RIP," Aug 12, 2008
6. ^ committee for small government - campaign finance report
7. ^ Boston Herald "Carla Howells tax fight pays off for Her and activist pal"
8. ^ committee for small government - campaign finance report - 2008 ballot question 1
9. ^ The committee for small government - campaign finance report- 2002 ballot question 1
10. ^ Committee for Small Government
11. ^ Ballot Question Would Eliminate Income Tax In Mass., MyFox Boston, Dec. 2, 2007
12. ^ WBZtv.com "Ballot Question Rattles Nerves On Beacon Hill," Aug 11, 2008
13. ^ WickedLocal.com: "Selectmen oppose elimination of state income tax," Sep 3, 2008
14. ^ Forbes.com: "Backers of tax question have just $24,753 in bank," Sep 10, 2008
15. ^ Amherst Bulletin: "Efforts under way to defeat income tax ballot measure," Sep 5, 2008
16. ^ Worcester Telegram & Gazette: "DC donations flood Mass. ballot question campaigns," Sep 21, 2008
17. ^ Boston.com: "This Question is Not the Answer," Sep 28, 2008
18. ^ [1]
19. ^ Coalition for our Communities - campaign finance report
20. ^ The 2nd American Revolution
21. ^ Politicker: "Ballot initiative to abolish income tax will appear on November ballot", July 3, 2008
22. ^ CapitalNews9.com: "Group wants to abolish state income tax," May 19, 2008
23. ^ WickedLocal.com: "Union group made calls to tax cut petition signers, challenge seems unlikely"
24. ^ "2008 Return of Votes Complete" (PDF). Massachusetts Secretary of the Commonwealth. 2008-12-17. http://www.sec.state.ma.us/ele/elepdf/2008%20Return%20of%20Votes%20Complete.pdf. Retrieved 2008-11-05. 
25. ^ "Enrollment Breakdown as of 15 October 2008" (PDF). Massachusetts Secretary of the Commonwealth. 2008-10-30. http://www.sec.state.ma.us/ELE/elepdf/st_county_town_enroll_breakdown_08.pdf. Retrieved 2008-11-05. 

External links

Note:: The original version of this article was taken from Ballotpedia's article about the Massachusetts State Income Tax Repeal Initiative

• Committee for Small Government
• Summary from Massachusetts AG of the initiative
• Campaign finance filing statement of Small Government Committee
• Tax revolt in Tea Party Zone
• Memorial Day Moneybomb

Additional reading

• Galvin makes income tax repeal Question 1 on ballot
• Initiative to repeal state income tax gets first slot on November ballot