Massachusetts House Kills Healey’s Prescription Drug Tax Plan

Democrat Governor Maura Healey proposed a tax on prescription drugs in Massachusetts, as part of the $62 billion budget she filed in January. Lawmakers don't care much for the idea.

House Speaker Ron Mariano announced on Wednesday that the proposal has been eliminated from consideration.

Healey's plan to tax prescription drugs was not the first time the idea was considered on Beacon Hill.

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In 2003, Republican Governor Mitt Romney vetoed a $36 million prescription drug tax on pharmacies included in the Fiscal Year 2004 budget. The plan, approved by the Massachusetts Legislature, called for a $1.30 pharmacy tax on every prescription filled.

A press release at the time said Romney vetoed the tax because it had a "disproportionate impact on senior citizens and others who live on fixed incomes." Lawmakers overrode the veto.

A Massachusetts Superior Court Judge determined the pharmacy assessment to be an "illegal excise tax."

KFF Health News cites a Boston Globe report that Massachusetts Superior Court Judge Allan van Gestel "overturned a state prescription tax and said that Massachusetts must return $18 million in revenue collected from the tax."

Healey's proposal would have charged pharmacies a fee of up to $2 per prescription, with the revenue generated dedicated to the state's struggling MassHealth program.

The Franklin Observer reports the Massachusetts Fiscal Alliance considered Healey's proposal a "prescription for disaster" and a "hidden tax that will ultimately be passed on to consumers, raising healthcare costs at a time when families, seniors, and small businesses can least afford it."

Healey's proposed tax on prescription drugs garnered little support from state lawmakers, even as state revenues are shrinking.

The prescription drug tax was just one of several new or increased fees/taxes proposed by the administration this year. The new fiscal year begins July 1, 2025.