Daily Hampshire Gazette sets the stage for an upcoming public hearing on the Governor’s proposed tax reforms (including changes to the Massachusetts estate tax law):
Healey’s plan (H 42) combines a new $600-per-dependent tax credit for parents and caregivers with relief for renters and seniors, slashes the short-term capital gains tax rate from 12% to 5%, and would triple the estate tax threshold to $3 million. The governor pitched it last month as the “start of a conversation” and her proposal is likely to be rewritten if or when it moves through the Legislature. The Revenue Committee, chaired by Rep. Mark Cusack of Braintree and Sen. Susan Moran of Falmouth, is its first stop.
The governor’s proposal has been met with hesitation or criticism from some of her fellow Democrats and quickly drew the ire of some influential progressive groups over its embrace of business-backed tax code changes, while the tax credits she proposed have received a better reception. The Massachusetts Budget and Policy Center said that the children and family, senior citizen, and renter credits would be progressive, the estate tax and capital gains tax changes would be regressive.
“The Governor’s proposal would provide benefits to households across the income spectrum, but by far the largest benefits would accrue to a small number of very wealthy families,” MassBudget wrote in a report last week.
The Washington D.C.-based Tax Foundation earlier this month said that the capital gains and estate tax reforms in Healey’s proposal “are good policy and welcome incremental changes to the Commonwealth’s tax code, but they beg for consistency.” The group, which has repeatedly said it thinks the income surtax that voters approved last year will hurt the state’s competitiveness, said that “the logical conclusion” of Healey’s proposal for neutral tax treatment of capital gains income “supports the return to a flat rate individual income tax.”
This post is a part of Old Colony Law’s Estate Tax Updates.