An effort to tax the Bay State's highest earners and funnel that money into schools and transportation moved forward Wednesday.
Lawmakers voted 135-57 in favor of the "millionaires' tax" at Wednesday’s Constitutional Convention, the first in a long process to amend the state’s constitution. The amendment needed only 50 votes to move forward.
The proposal would add a 4 percent tax to wages over $1 million. Doing so could raise as much as $1.9 billion a year for schools and transportation, proponents have said.
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"We have an unsustainable tax system. We are not able to raise the revenue needed to provide fundamental services for the citizens of our cities and towns,” said bill sponsor Rep. Jay Kaufman, according to the State House News Service.
The proposal has broad support in the state, with an overwhelming 70 percent of voters saying in a recent survey they were in favor of the measure.
It would appear on the ballot in 2018 at the earliest. It heads to the ballot if at least 50 members of the House and Senate vote in favor of the amendment again in 2017.
Among other concerns, opponents fear wealthy residents will flee the state to avoid forking over more of their paychecks to the government.
Senate Minority Leader Bruce Tarr called the idea a “success penalty,” according to the News Service.
The constitution as of 1917 requires that everyone’s income be taxed at the same rate (which right now is 5.1 percent) – in other words, a flat, or what some call “regressive” tax.
General Electric CEO and megamillionaire Jeff Immelt, for one, said he wasn’t concerned about it.
“Whatever happens, happens,” the soon-to-be-Bostonian said when he was in the city for GE’s big coming-to-Boston press conference. As Commonwealth Magazine points out, Immelt stands to see his tax bill jump $400,000 if the amendment passes.
So where are all these millionaires?
According to a recent report from lawmakers, Boston has the most, with 1,617 of them living in the city in 2013. That’s 2.57 millionaires per 1,000 residents.
Other millionaire municipalities: Newton, 1,058; Wellesley, 726; Brookline, 417; Cambridge, 404.
The state GOP responded after the vote, saying it was "another attempt to raise taxes on every individual at every level to satisfy Democrats' unquenchable thirst for spending."