Re: Romney and Fiscal Issues | The American Spectator | USA News and Politics
Re: Romney and Fiscal Issues
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Romney faced a pretty challenging political climate for broad-based tax cuts, because the 87 percent Democratic legislature was resisting tax cuts that had already been passed. In 2000, with the support of then Gov. Paul Cellucci, Massachusetts voters approved by a 3-to-2 margin a ballot initiative that rolled the state income tax rate back from 5.85 percent to 5 percent. (That’s right, Taxachusetts has a flat tax on income.) The legislature never allowed the full tax cut to take place — the tax rate currently stands at 5.3 percent.

Romney backed the full rollback, which could be described as a broad-based tax cut. He proposed more than once to do it in two steps, knocking it down to 5.15 percent one year and all the way down to 5 percent the following year. But Romney didn’t have a Peter Vallone figure in the legislature. The closest was probably House Speaker Tom Finneran, a conservative Democrat, who opposed the full rollback and was only speaker for about half of Romney’s term.

During the budget crisis, Romney had a brief period where the legislature gave him substantial leeway on fiscal policy. Many, perhaps most, Democrats on Beacon Hill would have preferred to abandon the rollback entirely and raise taxes. Romney was able to balance the state budget without any increase in income tax rates and mostly without raising particularly broad-based fees. But he did make some concessions to get his spending cuts through the legislature. Once the budget was in surplus, the legislature mostly ignored Romney and overrode his vetoes. (Ironically, the rollback was necessitated by the last budget crisis under Michael Dukakis. In 1989, the state approved a “temporary” increase in the state income tax rate from 5 percent to 5.95 percent.)

Romney didn’t have as much success cutting taxes as Giuliani. Nor did he have anywhere near the success in working with an overwhelmingly Democratic legislative body, which is certainly a legitimate campaign issue. But both of them were as supportive of tax cuts as they could be in the political climates they faced.

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