Under Patrick's plan, the state income tax would go up one percentage point, to 6.25 percent, but exemptions, the amount of income on which you don't pay income tax, would be doubled. At the same time, the sales tax would drop from 6.25 percent to 4.5 percent. The effect:
While average taxpayers who earn less than $37,523 would see a $100-to-$200 tax cut, everyone else would pay higher taxes. Those who earn more than $102,886 would bear the brunt, paying an additional $3,200 a year in combined income and sales taxes.This is the kind of big thinking that's too rare even in states, like Massachusetts, with Democratic governors and heavily Democratic legislatures. When they're in control, Republicans don't hesitate to enact sweeping agendas, but Democrats are so much more timid, a timidity we're already seeing in the responses of Massachusetts legislators to Patrick's proposal. But go below the fold to see how, introducing the plan in his State of the Commonwealth address, Patrick made the case for what the state could do with the $1.9 billion in additional annual revenue this plan would provide:
For those in between, the change would be less dramatic. Taxpayers who earn $37,523 to $60,414 a year would pay $100 more, while those who earn $60,414 to $102,886 would pay $400 more.
Patrick argued his plan will make the tax code simpler and fairer because he will double personal exemptions and eliminate 45 deductions. His plan also calls for changing the corporate tax code to raise $149 million annually. Those changes include ending a deduction for large companies and eliminating a special classification for security and utility firms.
(Continue reading below the fold.)
Let’s ensure that every child in Massachusetts has access to high quality early education. We know from educators, from academic research, from years of public policy, and from our own experience as parents that investing in our children at a young age pays huge dividends for them and for our community as a whole.Deval Patrick has not always been a particularly progressive governor. But if this is how he wants to make his mark—bringing in more revenue to invest in things important to all residents of the state, and doing so by having wealthier people pay more—that's fantastic. Now we just need Massachusetts' Democratic legislators to not be giant wimps standing in the way.
Let’s once again fund K-12 education higher than we did last year. Our lead in education is too important to lose. Our competitor states and competitor countries are not slowing down – neither should we. And as we do, let’s focus resources where poverty is too often concentrated, and ensure that every middle school in every Gateway City has a longer school day, filled with enrichment programs, service learning, art, exercise and music.
And let’s do more to make a college education affordable. Looking at those students at the Orchard Gardens school, thinking about where they want to go – you could hardly contain the promise and potential in the room. And why would we want to? Somewhere in that room or in one like it is the person who is going to cure cancer; or take us to Mars; or invent the next iPad. Somewhere in that room or one like it is the nurse who is going to care for us; the craftsman who is going to rebuild the skyline of our cities; the musician who is going to draw thousands to concerts; the teacher, like little Adriana wants to be, who is going to inspire another child. We have made great strides in higher education, and I am especially proud of our community college reforms last year. Let’s take the next step by raising our investment in public colleges and universities, and reinvigorating the MassGrants scholarship program.
We have unmet needs in our transportation system, too. And everybody knows it. Let’s give our citizens a 21st Century transportation network. Just imagine it.
Imagine if you could depend on a bus or subway that came on time, was safe and comfortable and ran until a student at UMass Boston or a worker in a downtown tower finished up at 1:00 or 2:00 in the morning. Imagine if a young innovator in the Seaport District could get a fast train to an affordable apartment in New Bedford at the end of the day or the family in New Bedford had access to the work and social opportunities in Boston. Imagine if the Green Line ran to Medford and the commuter rail ran to Springfield and the Housatonic line was reopened between Pittsfield and New York. Imagine if you could drive at highway speeds the whole length of the Pike and let technology collect your tolls. Imagine that the interchanges on 128 in Canton and Woburn were smoothed out and you didn’t have to add 45 minutes to your commute at rush hour just to get through the bottlenecks.