Both Senate Minority Leader Bruce Tarr and Ways and Means Chairman Michael Rodrigues described the relief — crafted to take effect immediately, unlike the tax breaks passed in the Massachusetts House of Representatives — as meaningful and substantial support for taxpayers with the commonwealth awash in surplus revenues.
The House and Senate will have to reconcile differences in their bills before it can be sent to Gov. Charlie Baker, who since January has repeatedly pressed the Legislature to pursue his $700 million tax relief package.
The rebates forge a major highlight of the nearly $4.6 billion economic development bill passed by the Senate Thursday, as lawmakers scramble against the July 31 end-of-session countdown.
“It all goes into effect this calendar year ensuring real, immediate relief for the citizens of the commonwealth,” Rodrigues said on the Senate floor Thursday morning. “Additionally, the Legislature created a premium pay program earlier this year, which has thus far provided $500 checks to over 770,000 low-income workers, and those checks are still going out. To that end, the tax package before us — coupled with the premium pay program — is a way of well-balanced, affordable (relief) in the long-term and targeted for mostly low- and moderate-income individuals and families.”
Top Senate and House Democrats unveiled the $250 rebate initiative earlier this month for middle-income households in the commonwealth.
Single filers earning $38,000 to $100,000 can expect to receive the stimulus checks by the end of September. Married taxpayers filing joint returns with a maximum income of $150,000 will see $500 rebates. Efforts to remove the minimum income eligibility threshold failed Thursday.
The rebates are not a done deal just yet, though. House and Senate members must negotiate discrepancies between their economic development bills, including varying approaches to redrafting the estate tax, before sending a compromise version to the governor.
Other tax relief in the Senate bill passed Thursday include:
- Child and dependent credit: Raises the credit from $180 to $310 per child, while nixing the credit cap for number of children and dependents who are eligible.
- Earned income tax credit: Increases the 30 percent match of the federal credit to 40 percent.
- Rental deduction: Boosts the cap, which is based on 50 percent of rent paid, from $3,000 to $4,000.
- Senior circuit breaker: Bumps the maximum credit — designed for seniors whose rent or property taxes exceed a certain portion of their yearly income — from $1,170 to $2,340.
Baker, during an interview Thursday on GBH News’ Boston Public Radio, called the Legislature’s pending changes to the estate tax “appropriate” to bolster Massachusetts’ competitive edge to attract and retain residents.
Through the Senate bill, the estate tax threshold would increase from $1 million to $2 million, while also providing a uniform tax credit of $99,600 to estates above that figure to wipe out tax liability.
The House, which like the Senate is interested in eliminating the so-called cliff effect associated with the estate tax, would also raise the estate tax threshold from $1 million to $2 million, taxing only above that higher amount and escalating the rate for estates over $5 million.
“There are a lot of Democrats who support doing because they’ve been hearing from constituents in their own district that a lot of people leave — they would like to have stayed in their communities and stay in the commonwealth — because of this issue,” Baker said on GBH.
©2022 Advance Local Media LLC. Distributed by Tribune Content Agency, LLC.
Related Articles
