NewburyportNews.com, Newburyport, MA

Local News

September 14, 2013

Lawmakers poised to repeal tech tax

O'Connor Ives: New taxes not needed to replace anticipated revenue

BOSTON — It doesn’t happen very often, but Massachusetts is about to repeal a tax.

Just implemented on Sept. 1, the new 6.25 percent sales tax on computer and software services is on its deathbed, doomed after an uproar from the business community.

Democratic legislative leaders from both the House and Senate announced at a news conference on Thursday that they were moving to rescind the unpopular new technology tax, part of the $500-million transportation financing package approved in July. Only a matter of a few weeks old, momentum toward repeal snowballed this week when several top Democratic officials abandoned support for the tax, which business leaders worried would have a negative impact on the state economy.

‘‘It is now evident that the impact of the tax is broader than any of us ever anticipated or intended,’’ Senate President Therese Murray, D-Plymouth, said at the press event.

Republicans, including state Reps. Bruce Tarr, R-Gloucester and James Lyons, R-Andover, filed a bill repealing the tax earlier this week.

Gov. Deval Patrick, who originally proposed the tax in January as part of his $1.9 billion transportation and education plan, announced his support for repeal on Tuesday. Thursday, Murray and House Speaker Robert DeLeo, D-Winthrop, announced their they’d soon schedule votes in their chambers to bring about the termination of the tech tax.

But Patrick has said he wants an alternative source of revenue to replace the $161 million the tech tax was estimated to have generated.

DeLeo made clear at Thursday’s press conference, however, that would not be the case.

‘‘I want to emphatically say: There is going to be no proposal of any new taxes to make up for this revenue,’’ DeLeo said, adding that he anticipated no state budget cuts as a result of the repeal.

State Sen. Kathleen O’Connor Ives, D-Newburyport, said she’s of the same mind.

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