Massachusetts was home of the Boston Tea Party, but in recent
years the commonwealth’s voters have tended to docilely accept
whatever level of taxation the robber barons on Beacon Hill deem
appropriate. When the tax issue is put directly on the ballot,
however, Bostonians momentarily regain their tax-resisting,
tea-dumping spirit.
In 1980, the same year Massachusetts voted for Ronald Reagan,
Bay State voters approved Proposition 2 1/2. Following on the heels
of the tax revolt Howard Jarvis started with Proposition 13, this
measure subjected municipal property-tax increases to a 2.5 percent
annual limit. Neither can property taxes exceed 2.5 percent of the
assessed value of all taxable property. Twelve years later, as
Massachusetts was re-electing the Republican governor who rang down the curtain on the
Dukakis era, the voters defeated a ballot initiative that would
have created a graduated state income tax. In 2000, they voted to
roll the state’s income tax rate back to 5 percent, from which it
had been “temporarily” raised in 1989.
Now the commonwealth’s beleaguered taxpayers are trying repeat
these past successes with another ballot initiative to roll back
the state income tax — to a new flat rate of zero. The Committee for Small
Government is leading the charge for Question 1, a referendum
that would abolish the 5.3 percent Massachusetts income tax
entirely, along with a state capital gains tax that peaks at 12
percent.
Can Ron Paul’s preferred tax rate pass in a state that elects
Ted Kennedy, John Kerry, and an 88 percent Democratic legislature?
An income-tax repeal initiative first made the Massachusetts ballot
in 2002. The Boston Globe and Suffolk University both took
polls shortly before the election that pegged its support at 34
percent. A Boston Herald poll put the figure at 25
percent. Political analyst Jim Braude predicted it would get less
than 20 percent of the vote.
When the dust settled, Question 1 received 45.4 percent of the
vote. The income-tax abolition initiative carried one-third of
Massachusetts’ cities and towns despite little media coverage, a
volunteer campaign, and less than $89,000 in pro-Question 1
advertising spending. This time around, polls are showing a dead
heat, with the initiative trailing 46 percent to 45 percent —
within the margin of error.
“I don’t think there’s anyone who doubts the possibility we’re
going to win this time,” says Carla Howell, chairman of the
Committee for Small Government. Howell has run for three statewide
offices as a Libertarian candidate, winning 12 percent of the vote
in the 2000 Senate race and finishing just a point behind Ted
Kennedy’s Republican challenger. But her main goal has been trying
to shrink government by taking a major revenue source away from the
state legislature.
“People are angry, the economy is shaky, and people are feeling
financially insecure,” Howell says when asked how the Massachusetts
political climate has changed since 2002. She might be right. The
Big Dig and careening state budget have made Bay Staters more
acutely aware of government waste. A statewide poll found that the
average Massachusetts voter believed that 41 cents out of every
state tax dollar is wasted — the exact percentage of the state
budget funded by the income tax (although when off-budget spending
is taken into account, income tax revenues are only 27 percent of
state expenditures).
“Massachusetts is one giant perception that government is out of
control — and it’s an accurate perception,” says Barbara Anderson
of Citizens for Limited Taxation and Government. “The Big Dig is a
very visible example. Our per capita tax burden is one of the
highest in the nation. So is our debt. So are our unfunded
liabilities. Our public employee benefits.” Anderson, who has been
a leading spokesman for lower taxes in Massachusetts since the
Proposition 2 1/2 battle, supports repealing the income tax.
“Question 1 must pass or it sends the message that taxpayers in
Massachusetts will put up with anything,” she says. “We’ll be
looking at a tax increase instead of a tax cut.”
Question 1 faces some very determined opponents: public
employees unions, cities and towns who fear cuts in municipal aid,
both the Democratic and Republican leaders in the legislature, and
much of the media. The Boston Globe editorialized that “efforts to tamp down antitax
sentiment in Massachusetts” should be helped by a new national
study showing the commonwealth near the middle of the pack in terms
of state tax bite. Though much of the credit should go to tax cuts
and ballot initiatives the Globe usually opposed, the
paper used the study to oppose another: “In November, voters will
be faced with a ballot question to eliminate the state income tax.
The tax foundation’s report shows Massachusetts moving in the right
direction.”
From Howell’s perspective, that “antitax sentiment” is a sign
things are moving in the right direction. Question 1 is enjoying
more support from talk radio this time around. Massachusetts
Republicans are less opposed. “About half the [GOP] state committee
is with us,” Howell says. “The state party chairman is neutral.”
She emphasizes the repeal would give the average Massachusetts
worker a $3,600 annual tax cut while rolling the state budget back
to its 1995 level. To put that in perspective, that’s the year Bill
Weld began his second term as governor.
Even if Question 1 passes, its opponents won’t stop fighting.
The state income tax rate still stands at 5.3 percent because the
legislature refused to implement the last phase of the
voter-approved rollback. Beacon Hill similarly ignored the voters
on the Massachusetts Clean Elections law. “I’m sure they will try
to do whatever they can get away with,” says Howell. “The question
is what they can get away with.”
If the state that fired the shot heard round the world ends its
income tax, it will have a lot of politicians around the country
wondering what they can still get away with.
