Massachusetts Budget Chair Rodrigues, Beacon Hill Leadership Announce More Tax Relief

After calls from Massachusetts Governor Charlie Baker to use the Commonwealth’s record budget surplus to provide tax relief to the residents of the Commonwealth, House and Senate leadership on Beacon Hill unveiled the first part their tax relief package on Thursday.

The proposal is a one-time $250 rebate to taxpayers who file individual tax returns and $500 to married couples who file jointly. These payments are targeted to residents who have earned between $38,000 and $100,000 individually and married couples who earned up to $150,000 jointly in 2021. 

“Whether it is the rising price of gas, groceries, or summer clothes for kids, the Massachusetts Legislature has heard loud and clear that increased costs due to inflation have cut into family budgets,” said Speaker Ron Mariano, Senate President Karen Spilka, House Ways and Means Chair Aaron Michlewitz, and Senate Ways and Means Chair Michael Rodrigues in a joint statement on Thursday.

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When asked about why a $38,000 minimum was set for individual earners, Rodrigues at that time told WBSM that the state legislature had already approved and distributed approximately one million $500 payments to lower-income residents after Governor Baker signed the $4 billion American Rescue Plan Act and surplus tax revenue spending bill in December of 2021, and that this round of payments are targeted toward middle-income earners.

Rodrigues added that legislature is currently working on permanent tax relief for lower income individuals.

On Monday, Rodrigues and Beacon Hill leadership released more details on their comprehensive tax relief plan which included an expansion of the senior circuit breaker tax, credit for older residents who rent their homes, as well as increases to the earned income tax credit and child and dependent caregiver tax credits.

In June, Baker had proposed a $700 million tax relief package to the state legislature after it was projected in the spring that that Massachusetts tax revenues would be around $3.6 billion above its benchmark for FY 2022. Spilka and the legislative leadership on Beacon Hill had guaranteed both chambers would take up tax relief in July after the FY 2023 budget had been completed. 

While House and Senate leadership said in their joint statement on Monday that the details of the package still need to be ironed out, the framework of their proposal surpasses Baker's $700 million figure to total around $1 billion in tax relief for Commonwealth residents.

Rodrigues told WBSM that more details of the comprehensive tax relief package will be released before the end of the legislative session on July 31.