By the time my Easter lily begins to fade and my chocolate bunny is gone, we may know the full fate of Gov. Deval Patrick’s $1.9 billion tax increase proposal, which is presently being sniffed and nibbled on Beacon Hill. Not that there’s anything sweet-smelling/tasting about a tax hike.
New spending on transportation and education proposals in the governor’s fiscal year 2014 budget depend upon new revenues. Speaker Robert DeLeo and Senate President Therese Murray had a joint news conference yesterday supporting roughly $500 million more: a 3 cents-per-gallon increase in the gas tax, adjusted for inflation in the future; a $1-per-pack increase in the cigarette tax; and application of the sales tax to computer system design services and utility classification.
Last month, the Joint House/Senate Revenue Committee held a hearing on the governor’s taxes, including his increase in the 5.25 percent income tax rate to 6.25 percent. Some income tax hike could still be included in the House budget, due out next week.
Chip Faulkner was at the hearing to testify for bills reducing the income tax and sales tax rates to 5 percent: a nicely “balanced approach.”
Good thing he was there, since the mayor of Springfield showed up with a brand-new attack on Proposition 21/2! Because Mayor Domenic Sarno wants one of the proposed state casinos to be built in Springfield, he’s asking for casinos’ property taxes to be exempt from the Proposition 21/2 levy limit, letting those taxes take the tax rate above the 2.5 percent ceiling.
Dangerous precedent. I can hear a logical argument that a casino is just another business, so if it is exempt, why not all businesses? Why not an industrial park, or a Walmart? Chip was quick to point out that Springfield has been one of the most mismanaged cities in the commonwealth, which is why its tax rate is sitting right on that 2.5 percent limit in the first place, unable to count the casino taxes as new growth.
Chip also pointed out that Massachusetts is not suffering from a shortage of taxes. According to the nonpartisan Tax Foundation, our state and local tax burden is still fourth-highest in the country, 31 percent above the national average.
Yesterday, the Tax Foundation released its annual Tax Freedom Day report. On April 13, 2013, taxpayers in the United States, as a whole, stop working for their federal, state and local government and begin to work for themselves. In Massachusetts, the date is April 25 — the fourth-latest in the nation.
Yet, we don’t adequately maintain our roads and bridges or run the MBTA with transparency or efficiency. We don’t keep track of welfare recipients’ electronic benefits cards. The state inspector general has told us that the commonwealth can’t prove the eligibility of roughly 33 percent of children receiving welfare benefits, doesn’t know if any of them are in school, if they are even in the state, or in fact if they exist at all.
During the House budget debate later this month, Republican and reform Democratic legislators will try to address some management issues with amendments. The Republicans are expected to resist any new taxes. Gov. Patrick is scheduled to push his full package at another Statehouse rally today, this one organized by a group called Stand for Children. Maybe it can find all those children who are getting benefits?
Speaking of children, someone noted on my April 1 Facebook page that “Obama has declared April the month in which his administration will teach young people ‘how to budget responsibly.’” I think this was an April Fools’ Day joke.
My favorite April 1 joke was a news release from Washington-based Americans for Tax Reform.
“Berkshire Hathaway Chairman and CEO Warren Buffett today announced he had written a donation check to the U.S. Treasury in order to personally comply with “The Buffett Rule.” ... Championed by President Barack Obama and congressional Democrats, the Buffett Rule is a proposed 30 percent tax on all income over $1 million.
“The Oracle of Omaha will personally unveil a 3-foot-by-6-foot donation check at an afternoon press conference on the Treasury steps. According to a statement released in advance of the event, Buffett said, ‘my friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice. Today, I, Warren Buffett, am personally getting serious about shared sacrifice.’
“The White House praised Buffett’s action. ‘Let me be clear,’ said President Obama. ‘This puts to rest any GOP-driven allegations that Warren Buffett was a hypocrite on the tax issue or was just engaging in a bit of moral preening.’
“Because the federal tax code is already steeply progressive, the Buffett Rule, if enacted, would raise just $31 billion in tax revenue over the next decade, according to the Joint Tax Committee. To put that in context, that is less than one-tenth of one percent of federal spending over the next 10 years.”
Very funny; sarcasm remains my favorite kind of humor. You can hear ATR leader Grover Norquist on April 13 when he is the keynote speaker at the Greater Boston Tax Day Tea Party Rally from 1 to 3 p.m. on Boston Common.
Barbara Anderson of Marblehead is a regular Salem News columnist.