The personal income tax in Massachusetts has been subject of debate for a few years now. Despite having a flat rate of 5.3%, adjustments such as the Earned Income Tax Credit and exemptions for our lowest-income taxpayers mean that it is one of our state’s most progressive taxes. Over the years, people have also pushed to make it even more progressive by implementing a graduated income tax in Massachusetts – taxing higher income earners at higher levels than low-income earners.
The report also shows how heavily the state relies on more regressive taxes such as property and sales taxes, and very little on corporate and other types of taxes. And while this information is not a surprise, it would be a welcome change to see a more balanced revenue structure. Corporations and individuals value the public structures we have in place in the state, but contribute in very different proportions for their creation and maintenance as shown in this recent report. While no one would argue that corporations play a keyrole in contributing to the state we cannot forget that the public structures that are in place make the state an attractive one for both businesses and families.
It is time to think about what we value in our communities and how we should pay for those structures. Reports like this one help us understand how the state gathers its resources and decide how we want to continue obtaining them. By gathering this type of information – from our state and across the nation – we can build a tax system that shares responsibility in a more proportionate way among each person and corporation in our state.