A pair of payments making their method by the Legislature purpose to show the clock on the state gross sales tax again to 2008.
Payments filed by Senate Minority Chief Bruce Tarr and state Rep. Marc Lombardo would cut back the state gross sales tax from its present charge of 6.25% again to the 5% charged about 16 years in the past.
The payments, each bearing a title alongside the traces of “An Act relative to lowering the sales tax to 5%” had been the topic of a Joint Committee on Income listening to on Monday together with about 40 different payments coping with gross sales and excise taxes.
In keeping with Brian Shortsleeve, a former Baker Administration official who’s in search of the Republican nomination for governor, the thought makes numerous sense within the present financial local weather.
“Massachusetts families are being crushed by inflation, rising costs, and a government that keeps taking more of their hard-earned money. It’s time to give them a break. Rolling back the sales tax to 5% is long overdue,” he mentioned.
The state gross sales tax jumped from 5% to six.25% in August of 2009 in response to a extreme funds deficit. On the time, the state was reeling from the aftershocks of the 2008 monetary disaster.
The tax has remained at that degree since, regardless of ongoing efforts to see it lowered — some model of “An Act relative to lowering the sales tax to 5%” has been submitted throughout every of the final 5 legislative periods.
In fiscal yr 2025, the state made $9.613 billion in gross sales and use taxes, $290 million, or 3.1% greater than fiscal yr 2024.
Decreasing the gross sales tax is commonly cited as a method of serving to center and decrease earnings households, who spend extra of their incomes making ends meet than wealthier households, and due to this fact spend a proportionally greater share in gross sales tax.
“A lower sales tax means lower costs at the register for everything from school supplies to household essentials. This is real relief that people will feel immediately,” Shortsleeve mentioned.
Not taking motion means the established order — folks regularly leaving the state to do their procuring in a surrounding tax-free state — will proceed unchanged. That’s not good for the state’s aggressive edge, in line with Paul Craney, the chief director of the Massachusetts Fiscal Alliance.
“If Massachusetts leaders want to make the Commonwealth more affordable for its taxpayers, they should cut spending and reduce or eliminate taxes. Taxpayers would benefit greatly by a reduction in the sales tax. Our neighbors in NH don’t even have a sales tax, and many shoppers go to NH for their purchases. Keeping our 6.25% sales tax is not competitive,” Craney mentioned.
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