In a familiar refrain, Gov. Charlie Baker on Thursday again urged the Massachusetts Legislature to pursue tax relief for Bay Staters as the commonwealth continues to be awash in surplus tax revenue.
Baker pleaded his case on Twitter as he cited the state’s burgeoning rainy day fund, citing new data from the Department of Revenue that showed capital gains tax collections approached $2.3 billion from Feb. 1 through May 31.
Of that amount, about $1.9 billion will be transferred to the state’s rainy day fund, according to a letter shared publicly from Department of Revenue Commissioner Geoffrey Snyder.
Those numbers could change in the fourth quarter of fiscal 2022, Snyder said. But for now, Baker highlighted the rainy day fund’s new record amount of $6.6 billion.
“With MA families facing high prices, it’s time to give some of the surplus back by passing our $700 million tax cut plan,” Baker said on Twitter Thursday afternoon. “This $1.9 billion Rainy Day Fund deposit shows MA is in extremely strong financial shape. Our tax cut plan is affordable and the right thing to do. We hope our partners in the Legislature will join us to deliver meaningful relief for working families.”
Baker filed his hallmark tax break package earlier this year to accompany his fiscal 2023 budget proposal. Neither legislative chamber included the governor’s proposals — including relief for low-income families, renters and seniors — within their budgets, which now must reconciled in conference committee.
But Senate President Karen Spilka threw her support behind future tax breaks in April, in response to tax collections that shattered expectations and offered more financial viability to Baker’s plan. The governor also wants to overhaul the short-term capital gains and estate taxes, ensuring Massachusetts retains its competitive edge in a post-pandemic era where people have more flexibility where they work and live.
Beyond a sales tax holiday, Spilka and House Speaker Ron Mariano did not delve into any broad tax relief plans under consideration during a press conference with Baker earlier this week. Yet the governor, referencing mounting inflation, said Bay Staters have “earned” tax relief from Beacon Hill after bouncing back from the pandemic in an “extraordinary way.”
“I hope that a package that includes tax cuts for people in Massachusetts gets to my desk by the end of this session, so that we can sign it and say thank you to the people who made all that revenue possible,” Baker said Monday.