Tax breaks not on House budget chief’s radar
Michlewitz served on tax expenditure commission
THE HOUSE’S TOP budget official said his spending plan for fiscal 2022 doesn’t address outdated or ineffective tax breaks highlighted in a recent commission report and he doesn’t plan to push for separate legislation to deal with them.
Rep. Aaron Michlewitz of Boston, the chair of the House Ways and Means Committee, served on the Massachusetts Tax Expenditure Review Commission, which issued a report in March rating 26 tax breaks. Some, like the life science credit, received high marks, but others, including the film tax credit and an exemption for alcoholic beverages from the state sales tax, were flagged for their relatively low benefits and high cost.
The ratings, covering tax breaks worth hundreds of millions of dollars annually, were endorsed unanimously by the commission.
The Tax Expenditure Review Commission was created because tax breaks typically get approved but then never reviewed to see if they actually work. Sen. Adam Hinds of Pittsfield, a member of the commission, said he wants to use the commission’s reviews of the more than 200 tax breaks on the books as a guide for eliminating, scaling back, or modifying the measures.
The film tax credit reimburses movie and TV productions for 25 percent of whatever they spend in the state. Mariano says the film tax credit has worked extremely well in attracting films and TV shows to Massachusetts, generating lots of jobs in the process. The Tax Expenditure Commission said the film tax credit has generated a considerable number of jobs but at a very high cost — $100,000 per job.The House budget proposal did not include any provisions to eliminate the current sunset on the film tax credit.
The politics of tax breaks could get interesting as the legislative session progresses. The film tax credit is likely to become a bargaining chip in negotiations between the House and Senate over tax breaks or possibly other issues.