Massachusetts taxpayers to see tax cut approved back in 2000
BOSTON (AP) — In 2000, Massachusetts voters handily approved a ballot question meant to reduce the state’s income tax rate to 5%.
Two decades later they’re finally getting their wish.
Republican Gov. Charlie Baker announced this week that on Jan. 1, the income tax rate will be cut from 5.05% to 5%.
The tax cut marks the end of a process that began in 2002 following passage of the ballot question two years earlier.
The question was intended to gradually reduce the 5.95% tax rate to 5% by 2003. Lawmakers instead froze the rate at 5.3% in 2002 and passed a law that would eventually lower the rate to 5% over a much longer time frame, provided the state hit certain revenue milestones.
The 2000 ballot question passed easily with 56% of voters supporting the measure, 39% opposed and 5% casting blank ballots.
The state reached the final milestone this year, meaning the rate will drop from 5.05% to 5%,
The cut won’t be a windfall for most taxpayers but it will reduce state tax revenues by about $185 million in the fiscal year that begins July 1. The cut was already built into current spending plans for the first half of 2020.
The rate reduction was last triggered on Jan. 1, 2019, when the tax rate dropped from 5.10% to 5.05%.
“We are finally making happen what voters called for almost 20 years ago,” Baker said in written statement.