BOSTON - Today, Senate Democrats voted for a plan that freezes the income tax over the will of the voters, in order to pay for a special benefit for Hollywood elites. The plan stands in contrast to Governor Baker's proposal to help working families by boosting the Earned Income Tax Credit, paid for by eliminating the Film Tax Credit.
"Beacon Hill Democrats have once again shown that their backwards priorities are wrong for Massachusetts. Senate Democrats want to effectively raise taxes on everyone to benefit Hollywood elites, while Governor Baker wants to close the special benefit to support working families in Massachusetts. By overriding the will of the voters in freezing the income tax, Democrats have shown exactly why one-party rule in the Legislature is hurting the Commonwealth."
"Massachusetts Senate leadership...plan to propose paying for the tax cuts by permanently freezing the income tax at 5.15 percent.
"Massachusetts voters in 2000 passed a ballot question ordering the state income tax rate to be reduced from 5.95 percent to 5 percent." (Matt Murphy, "Senate leaders plan income tax freeze to pay for major tax cuts," State House News Service, 5/19/15)
Democrats want to kick the can down the road on the elimination of the Film Tax Credit.
"Senate leaders also plan Tuesday to ask members to back a Sen. Jamie Eldridge amendment that would instruct the Committee on Revenue to draft legislation to restructure the film tax credit program with an eye toward limiting the total cost of the program and ensuring that more of the benefits flow toward Massachusetts businesses and workers." (Matt Murphy, "Senate leaders plan income tax freeze to pay for major tax cuts," State House News Service, 5/19/15)
Democrats' plan also fails to invest in the Earned Income Tax Credit to the extent that Governor Baker's plan does.
"The amendment, sponsored by Sens. Benjamin Downing and Michael Rodrigues, would increase the earned income tax credit by 50 percent over three years to 22.5 percent of the federal credit, costing the state about $140 million in tax revenue, according to Senate aides.
"Gov. Charlie Baker earlier this year filed legislation to double the EITC to 30 percent of the federal tax credit, proposing to pay for the expansion by freezing the $80 million film tax credit program." (Matt Murphy, "Senate approves expansion of low-income tax credit, income tax freeze," State House News Service, 5/19/15)
The Department of Revenue has reported that most benefits of the Film Tax Credit go out of state.
"Only about one-third of the $304 million in spending generated by the tax credit was spent in Massachusetts; and of nearly 2,000 jobs created by the tax credit, only about one-third went to Massachusetts residents, the DOR report found." (Joan Vennochi, "Good riddance to the Mass. film tax credit," Boston Globe, 3/8/15)