WBUR

Gov. Patrick Calls For Income Tax Hike

Gov. Deval Patrick delivers his State of the State address at the State House in Boston, Wednesday. (Michael Dwyer/AP)

Gov. Deval Patrick delivers his State of the State address Wednesday. (Michael Dwyer/AP)

BOSTON — Gov. Deval Patrick outlined a sweeping proposal to restructure the state’s tax system Wednesday, asking the Legislature to raise the state’s income tax while also calling for a decrease in the state sales tax.

There was little surprise that Patrick would be proposing new revenues in his State of the Commonwealth address. Over the past few days, he’s been outlining bold initiatives in the areas of education and transportation at a price tag of an extra $1.9 billion a year.

In making his pitch to lawmakers for extra revenues, he said opportunity requires growth and growth requires investment.

“It’s just as true of government as in any business. The economy is not like the weather; it is not some natural force that is beyond our control, something where we have to wait for others to predict or explain,” Patrick said. “What we choose to do, and not to do, shapes our future.”

To pay for the initiatives in education the governor is calling for the state’s income tax, now at 5.25 percent, to go up a full percentage point to 6.25 percent.

“To make that increase fair to all according to their ability to pay, I will propose that we double the personal exemptions for every taxpayer and eliminate a number of itemized deductions,” he said. “Making those changes gives us a tax code that is simpler and fairer.”

But while proposing the state’s income tax go up, the governor is also recommending the state sales tax, now at 6.25 percent, be lowered to 4.5 percent, with all money raised from the sales tax to be dedicated to a public works fund.

“That fund will support the transportation plan I have laid out — both our existing responsibilities and the necessary expansion projects — as well as the school building fund and other public infrastructure,” Patrick said. “Under my plan, sales tax proceeds would be off limits for any other purpose.”

The governor maintains that with these changes Massachusetts taxes will remain comparable and competitive with other states in the region. He acknowledges there will be debate, and he encourages it.

“Every one of us here has to think twice before asking people who already feel strapped to contribute a little more,” Patrick said. “But this time, instead of sinking into the same old slogans, let’s have a serious, fact-based debate.”

Outside the House chamber moments after the governor wrapped up his speech, House Republican leader Brad Jones was critical of the proposal. He says more savings can be made before raising taxes.

“There are still buckets of reforms that can be done and undertaken. And to the governor’s credit and to the Legislature’s credit, we’ve undertaken some of those, but more needs to be done,” Jones said.

In past years, Democratic leaders, such as House Speaker Robert DeLeo, have also been reluctant to consider tax increases. But this year, things might be different.

“We have to take a look at it. I mean this is a major proposal that the governor put forward to us today,” DeLeo said. “And I think it’s only fair we give the members the opportunity to talk about it, as the governor had stated, debate it, then we’ll have an answer.”

DeLeo’s counterpart, Senate President Therese Murray, agreed lawmakers need to look deeper into the proposal, but indicated they might give the governor some of what he wants.

“The governor’s definitely gone long on this,” Murray said. “And you know, I applaud him for that. But the devil’s in the details and we’re going to have to take a look and see what is in there.”

Lawmakers will get a better idea exactly what is in Patrick’s proposal next week, when the governor releases his detailed budget proposal.

This post was updated with Morning Edition feature content.

Please follow our community rules when engaging in comment discussion on wbur.org.
  • Pete

    Awesome.. Can’t wait!

  • http://twitter.com/LessinAlex Alex Lessin

    Excited about this bold proposal. Looking forward to a productive debate.

  • Lawrence

    This is just another attempt to extract more money from the hard working public, under the guise of “education and transportation.”

    Actually, there is enough money for these services if the state did not waste money and give it to the corporations.

    Remember when Menino gave $10 million to the W hotel? Then they went “bankrupt and were unable to repay.

    Remember when Obama provided $235 million for MA to spend on
    infrastructure, LIKE TRANSPORTATION, but instead went to build the
    Assembly Sq. Mall! A private corporate venture.

    Remember when Patrick, wanted to give the Patriots 9 MILLION for a
    footbridge? Thank God the public outcry was too loud for that particular
    act of corruption.

    Everyday the corporations bleed us dry then the officials use the
    lame excuse they need more money for education. They really need more
    money for the CEO’s and corporate give away’s.

    The NY Times had completed a full investigation into how states and
    cities are giving $80 billion a year to companies, all at the taxpayers
    expense.

  • maryanne

    Sticking it to the working class. Disgraceful.

    • http://www.facebook.com/profile.php?id=584573016 Raymond Soto

      What about the sales tax cut?

      • X-Ray

        We had a 25% increase in the sales tax. Now his proposal decreases it to about the original level. Smoke and mirrors.

  • Progressive republican

    One the one hand on the other hand.

    On the one hand we will assuredly be better off for making long term investments in infrastructure and education. This is where our current democratic system has shown its Achilles heel as the focus has always been ever more short term. Taking the hit for the longer term if done correctly is really investing in our future and will draw and keep more high skilled folks and their employers here. And to the whining about taxes- we have got to get off this big lie that all taxes cuts increase economic growth and all tax rises reduce it. Look no farther than the 1960s (high tax environment well above now) vs. the Bush tax cuts. Its HOW you spend it that matters.

    On the other hand, we need to be careful about how much additional taxation we impose over what period of time. There is already a 2% restoration of payroll tax (necessary but a reduction in take home pay nonetheless), a 1% increase in medicare tax, and 3% increase investment income from Affordable Health Care Act. All to say the public already has some decent sized hits coming.

    Where I come out on this is in favor of Patrick’s proposals but to a lessor degree. I would only put income taxes up by 1/2% and i would not cut sales tax as much. And i would phase it in over 5 years so there is no shock effect.

    These are fragile times and this kind of move needs to be handled with care.

    • debmorrison

      “HOW you spend it that matters” – You’re just asking that question NOW?

      You just listed a few taxes. There’s so many it’s impossible to keep track. Last year I paid over 100 dollars on a “state DBS Gross Revenue Tax” on my DirectTV bill. Just for my audacity to watch television, the state charged me over 100 dollars. Where did that money go to and how was it spent? Give me a break.

  • Tanya

    He is obviously out of touch with the regular working families of the Commonwealth.

Most Popular