This November, the Massachusetts electorate will vote on a ballot initiative that will have profound consequences: the ability for the state to amend its constitution and levy a 4 percent surtax on all individuals that have an annual income of one million dollars or more.
The Fair Share Amendment – or “millionaire’s tax” as it is known colloquially – is expected to raise significant revenue with the majority, if not all, of the monies to be invested in education and public transportation. It’s of no surprise then that the initiative is very popular with Bay Staters. According to a poll conducted late last year, 70 percent of the electorate support the initiative.
But its popularity has not stopped opponents from deploying recycled talking points expressed by wealth defense specialists. They argue that increasing taxes on high income earners are counterproductive because they will move to other states with a less punishing tax environment. A study by The Beacon Hill Institute estimated that about a fifth of Massachusetts’ 20,970 million-dollar earners will pack their bags and leave within the first year of implementation, shrinking the tax base and hurting the state’s economy.
The recent departure of some high-profile individuals and businesses from California has been cited as an example of progressive excess and is listed as a reason why Massachusetts should not pass the ballot initiative. But evidence of millionaire departures due to higher taxation or even a pronounced exodus of Californians is extremely thin, even with the emergence of remote work that has made employee mobility easier.