Grand bargain talks can now begin in earnest
Deal remains possible with millionaire tax dead, but it likely will be costly
Now that the millionaire tax is dead, state leaders can finally get down to work.
The millionaire tax was a great excuse for doing nothing. As long as the question was on the ballot and its poll numbers remained high, the millionaire tax’s $2 billion-a-year haul was the answer to just about everything. Fix the T? Don’t worry, we’ve got the millionaire tax. Address education funding inequality among cities and towns? Don’t worry, we’ve got the millionaire tax.
Perhaps the millionaire tax’s biggest impact was on the negotiations for a “grand bargain” to remove three other questions from the ballot. As long as the millionaire tax was viable, the backers of questions raising the minimum wage to $15, requiring employers to provide paid family and medical leave, and cutting the sales tax had little incentive to compromise. All of the questions polled well, so why strike a deal until all the chips were on the table.
Now that the millionaire tax is gone, the grand bargain negotiations can move forward, but they won’t be easy. The business groups that support reducing the sales tax from 6.25 percent to 5 percent can be more flexible now that the millionaire tax, which they opposed, is gone. Conversely, the demise of the millionaire tax may make it harder for the union groups backing a minimum wage hike and paid medical leave to compromise.
None of the sides announced their bargaining strategy on Monday, but they indicated a willingness to sit down and talk. “The Retailers Association of Massachusetts remains prepared to take the sales tax reduction to the ballot this fall,” said Jon Hurst, the president of the association, in a statement. “At the same time, we remain open to negotiating a balanced legislative resolution that will give our Main Street businesses, and seniors and low-income families a helping hand.”
The early consensus in the press was that the SJC decision was a victory of sorts for Gov. Charlie Baker, who never took a stand on the millionaire tax. The negotiations for a grand bargain, if successful, could also showcase the governor’s skills as a problem solver.But the death of the millionaire tax will also highlight the absence of any grand vision in his administration. With a millionaire tax, the possibilities were endless; without the tax, it will be steady as she goes, the usual grind.
“I’m not a big fan of raising taxes,” the Republican governor told reporters Monday, saying the court decision means “we have to move ahead, continue to invest in our Commonwealth, invest in our infrastructure, and invest in education as we have been, on terms that are consistent with the current tools that our available to us — which are pretty good.”