What would Massachusetts Ballot Question 5 actually mean for your taxes? The measure asks voters whether to change the formula that determines how much tax revenue Massachusetts can collect before returning excess money to taxpayers through rebates.
Massachusetts voters will decide
on nine statewide ballot questions this November.
Boston 25 News anchor Shana Ferreira breaks down question five,
a proposal that could change how much tax revenue
the state is allowed to collect
and when taxpayers get money back.
With Election Day around the corner,
we're tackling the ballot questions for you.
Question five specifically is called
the state revenue limit and rebate.
Under this proposal, the state's annual revenue limit would
be tied to how much it collected the previous year,
adjusted for the average growth in wages
and salaries over the past three years.
In simple terms, what would a yes on question five mean?
A yes on question five would change the way
the state calculates the cap it has
on how much taxes it can collect in a given year,
and basically over time make it more likely
that state tax collections will exceed a level
by which a rebate will go back to tax filers.
Doug Howgate is the president of the Massachusetts Taxpayer Foundation.
He explains Question 5 would set a new limit based on how much money
the state collected the year before adjusted for wage growth.
And if the state collects more than that limit,
the extra money would go back to taxpayers as refunds.
Supporters of ballot Question 5 say
that could mean more money back in people's pockets.
On the proponent side, I think it's a way to manage
a limit on the amount of taxes the state can collect
and make it more likely that you have rebates going back to tax filers.
But opponents warn it could also leave the state with less money
to prepare for emergencies and pay for public services,
including local aid for schools, cities and towns.
Because of the way this question would work is it would really
make it difficult for the state budget to recover from recessions.
I think that's something that may
not be totally obvious to voters when they look at it.
Adding a yes on five could pose the potential
for some financial issues for the state down the line.
What we can say with some level of assurance is it'll reduce
the amount of money that the state puts into its reserves,
which are the reserves that we tap into during recessions.
I think on the opponent's side, it's the fact that the way the math
of the recalculation works, it really will create, I think,
some predictable public finance challenges during tough times.
And that was Shana Ferreira reporting.
So a yes vote means changing the current rules.
A no vote means keeping them as they are.
If approved, the changes would take effect July 2027.
As a reminder, Election Day is November 3rd.
