Proposition 80 aka the “Millionaire’s Tax” is an attempt by far-left pressure groups to impose a constitutional amendment on the Commonwealth of Massachusetts that would allow the imposition of a surtax on income above $1,000,000 dollars. Currently, all Massachusetts residents enjoy a constitutionally protected right to equal taxation. Similar schemes have been rejected by the voters five times, each time failing by wide margins (1962, 1968, 1972, 1976, 1994). In 2018, the Massachusetts Supreme Judicial Court ruled an attempt to bring the measure to the 2018 ballot unconstitutional.
In June of 2021, the Fiscal Alliance Foundation and The Beacon Hill Institute (BHI) released a study showing the effects of instituting a so called “Millionaire’s Tax” on the Massachusetts economy: That study is available here: https://www.fiscalalliancefoundation.org/new-study-millionaires-tax-high-cost-low-return
The BHI/FAF study is the first time in recent memory that Massachusetts data was collected and used to determine the economic result if this tax were to become law. This is especially relevant because of the recent effects of COVID-19 on the state economy.
The Fiscal Alliance Foundation specifically states, “The “Millionaire’s Tax” will be harmful to state’s economy and will result in lost jobs, investments, and disposable income. With its high economic costs in place, the tax would also bring far less revenue than what proponents currently claim. Contrary to their messaging, BHI found that the middle class would also feel the impact of this tax. For example, in 2023, more than 4,000 families would leave Massachusetts with employment dipping by nearly 9,000 jobs. To make matters worse, according to BHI, the tax will only bring in about half ($1.2 billion) of the amount politicians are claiming ($2 billion). The dramatic discrepancy in how much would be collected would most likely not result in a reduction in planned state spending, but rather, new taxes and fees falling on the middle class to make up for the low return from the tax.”
Increasing taxes on wealthy citizens also has major potential to backfire. For instance, a single taxpayer, David Tepper, left New Jersey because of a similar tax scheme they launched, taking his investment company with him. Estimates put the loss of revenue upwards of $140,000,000 a year (New York Post, 4/10/16).
When politicians institute taxes like these, they spend the money immediately. When the revenue doesn’t pan out as projected, there’s only one place left to get the money they’ve already spent: middle and working class families. That’s when that million-dollar threshold will crash down on the rest of us.