Massachusetts Millionaires Tax Faces Legal Challenge

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By Aaron Nicodemus

Five business groups filed a legal challenge Oct. 3 to the Massachusetts millionaires tax to prevent it from being placed on the state ballot next fall.

The Massachusetts High Technology Council, the Massachusetts Taxpayers Foundation, Associated Industries of Massachusetts, the National Federation of Independent Businesses, and the Massachusetts Competitive Partnership filed a complaint with the Massachusetts Supreme Judicial Court over a constitutional amendment that would create a 4 percent income tax surcharge on incomes over $1 million. The complaint, filed against Attorney General Maura Healey and Secretary of the Commonwealth William Galvin, alleges that the proposed constitutional amendment violates the state’s constitution ( Anderson v. Healey , Mass., SJC-2017-0369, complaint filed 10/3/17 ).

Specifically, the groups allege the amendment violates Article 48, the section of the Massachusetts constitution on initiative petitions, in three ways:

  •  The amendment would pair an unpopular provision with two popular ones, a move the petitioners claim violates the constitution’s ban on combining two or more unrelated items, a practice known as “logrolling.” In this case, the unpopular portion is the tax, the petitioners said, which is combined in the same ballot question with more popular causes of funding for education and transportation.
  •  The amendment improperly allocates funding. Article 48 bars initiative petitions from making specific appropriations from the treasury. The amendment mandates that all money raised should be spent on education and transportation.
  •  The amendment would create a tax. Article 48 doesn’t mention tax as an item that’s allowed to be created by a ballot initiative.

“This lawsuit, in other words, is not about what decisions are made with respect to taxes and spending, but how they are made, and whether certain decisions should be the subject of statutory or constitutional law,” the complaint said.

‘Clearly Flawed’

The Democratically controlled Massachusetts General Court has twice approved the measure for the ballot. If passed by voters, the amendment would take effect Jan. 1, 2019.

Christopher Anderson, president of the Massachusetts High Technology Council, said in a news release that the amendment is “so clearly flawed and unconstitutional that it is alarming.”

“We would be equally opposed if they were proposing the opposite and trying to roll back the income tax and cut funding for education or transportation,” he said. “Amending the Constitution to achieve taxing and spending by popular vote is just a terrible idea, and could undo much of the good work that Massachusetts has done in terms of creating a successful economic climate.”

Arguments May Have Merit

Lawrence Friedman, a law professor at New England Law | Boston, said that in his opinion, all three arguments against the amendment have merit.

“I think there are credible grounds here to challenge the initiative,” he said. “These are strong arguments worthy of the SJC’s attention.”

The first argument, that the amendment could be struck down because its tax and revenue components are unrelated, is backed up by SJC case law cited in the complaint, Friedman said.

“There is the possibility for confusion in the minds of the voters. The items have to be related in a way that makes sense. These three items are not even in the same buckets,” he said.

He also said the SJC would have to rule whether earmarking money for transportation and education is broad enough, and that the constitution doesn’t specifically say that an ballot initiative can create a tax.

“The framers of the constitution did not intend to allow taxes to be set by popular vote,” he said. “The constitution leaves that job to the General Court.”

‘Secret’ Bankrolling

Raise Up Massachusetts, the group that placed the amendment on the ballot, criticized the business groups that filed the complaint, calling them a front for wealthy individuals who would pay more income tax if the amendment is approved.

Massachusetts High Technology Council member companies have received at least $144 million in tax breaks and other incentives from the commonwealth and local communities, according to Raise Up Massachusetts’ evaluation of state tax records. The average annual compensation of chief executives whose companies received public benefits is $12.3 million.

“These corporate executives have made tens of millions of dollars running companies that benefit from investments in transportation and public education, and they don’t hesitate to take millions of dollars in tax breaks from the state,” said Deb Fastino, Executive Director of the Coalition for Social Justice, in a Raise Up Massachusetts news release. “Now they’re secretly bankrolling a legal challenge to avoid paying a small percentage of their enormous incomes to make transportation and education investments that will help our economy grow.”

A coalition of labor, faith, and community groups, Raise Up Massachusetts also placed ballot questions on a $15 minimum wage and a paid family and medical leave program.

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

To contact the editor responsible for this story: Jennifer McLoughlin at

For More Information

Text of the complaint is at

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