BOSTON, Mass. (WWLP) – The Massachusetts Senate voted 29-11 in favor of freezing the state income tax rate to pay for a tax break that benefits the working poor.
The Massachusetts Senate is taking up a $38 billion spending plan for the fiscal year that begins July 1. They tackled tax policies during the first day of budget debate. Both Democrats and Republicans want to expand the state’s Earned Income Tax Credit that benefits lower wage-earning, working families by reducing the amount of taxes they owe based on income and family size. Recipients of the tax credit would see their benefits increase from $315 to $470 dollars each year. Defying a voter-mandated tax cut, the Senate voted to freeze the state income tax rate at 5.15 percent to pay for the program. Massachusetts voters approved a ballot question in 2000 to roll back the state income tax rate all the way to five percent. That plan came up short of its goal in 2002 when lawmakers passed a tax increase package.
West Springfield State Senator Jim Welch told 22News “we’ve gotten very close, we’re at 5.15 percent. (Reporter: But that’s not what the voters asked for.) Well, I would say that the voters voted on that in 2000 and as much as we want to live by what the voters have requested, we have rolled back that income tax.”
Senate Republicans voted against the state income tax rate freeze. They believe the state will have enough revenue in the future to pay for the Earned Income Tax Credit. The Senate still needs to win support from the House to advance the measure. The House did not include any new tax policies in their budget.