Massachusetts Millionaires Tax Will Face Voters in 2018

Daily Tax Report: State provides authoritative coverage of state and local tax developments across the 50 U.S. states and the District of Columbia, tracking legislative and regulatory updates,...

By Aaron Nicodemus

The Massachusetts Legislature voted to send the so-called state millionaires’ tax to voters next year.

The Constitutional Convention, consisting of all the state senators and representatives, voted 134-55 on June 14 to put the Fair Share Amendment on the state ballot in 2018. The measure known as the “millionaires’ tax” only needed 50 votes to pass, because it had been approved by last year’s convention.

The amendment and its 4-percent surtax on all personal income over $1 million will go into effect in 2019 if it receives voter approval.

The amendment would generate an estimated $1.9 billion a year in revenue, according to the state’s Department of Revenue. The money would be used to fund transportation and education, according to its proponent, Raise Up Massachusetts—a coalition of community groups, faith-based organizations, and unions.

Competing Voices

“The Fair Share Amendment is about tax fairness and making critical public investments in education and transportation, two of the pillars upon which a robust and prosperous economy are built,” Senate President Stan Rosenberg (D) said in a statement after the vote. “I hope the voters understand that this amendment benefits all Massachusetts residents.”

However, detractors like the Massachusetts Taxpayers Foundation and Associated Industries of Massachusetts say the new surtax will drive wealthy residents from the state, causing estimates of tax revenue to drop as well.

John Regan, AIM’s executive vice president for government affairs, wrote in a June 14 blog post that the amendment will disproportionately affect less than 1 percent of the state’s tax returns. Raising almost $2 billion from 19,500 taxpayers isn’t right, or fair, he argued.

“Before we approve a policy that raises so much from so few we must ask—does this imbalance make the commonwealth a better, or a worse place? We would suggest that it makes Massachusetts an unfair place,” he wrote.

Constitutionality Debate

After the vote, the Massachusetts High Technology Council called the amendment unconstitutional. The council is a nonprofit group that represents the state’s technology companies, research facilities, and universities.

“Allowing special interests to manipulate the ballot initiative process to permanently embed revenue earmarks via the constitution is an unconstitutional bypass of the Legislature’s accountability for ‘taxing and spending’ decisions,” Chris Anderson, president of the MHTC, said in a statement. “Nothing like this has ever been done before in the Commonwealth for a simple reason: the Massachusetts Constitution does not allow it.”

During the convention, Rep. Jay Kaufman (D), who voted in favor of sending the amendment to voters, said the constitutionality of the amendment was “not in doubt.”

“As I understand it, the constitutionality is not in doubt. That was the opinion of the attorney general who ok’d this for the ballot some time ago. I know facts are sometimes not an attractive antidote to strongly held beliefs, but we’re going to try to stick to the facts,” he said.

To contact the reporter on this story: Aaron Nicodemus in Boston at

To contact the editor responsible for this story: Ryan C. Tuck at

For More Information

The Fair Share Amendment is at

Copyright © 2017 Tax Management Inc. All Rights Reserved.

Request Daily Tax Report: State