Sales tax cut features in Republican gubernatorial candidate Chris Doughty tax relief plan

By Sam Doran

STATE HOUSE, BOSTON, AUG. 9, 2022…..Republican gubernatorial candidate Chris Doughty unveiled a tax reform plan Tuesday that calls for a major cut in the state sales and corporate tax rates and eliminating another tax that Doughty said leads to high prices at grocery stores.

Doughty called tax cuts a “cornerstone” of the platform he and lieutenant governor candidate Kate Campanale are running on, and pledged to stand firm against any future tax increases. Their plan would slash the sales tax from 6.25 percent to 5 percent, the rate that was in place until the Legislature hiked it in 2009.

Doughty said dropping down to 5 percent would increase Massachusetts’ competitiveness with neighboring states like New Hampshire. He contrasted the swelling revenues in state coffers with the fact that Massachusetts is “one of the most expensive states” to live in.

“There’s over 30 states in America have already put through significant tax relief in their states. As a result, our state has become less and less competitive as more states have been reducing their taxes. We have not cut a single tax in over two years, despite what the other states have done,” he said in a news conference in front of the State House.

State officials say Massachusetts taxpayers are in store for nearly $3 billion in income tax relief under a 1986 tax cap law known as Chapter 62F, which Doughty said he “absolutely” supports. Another $1 billion in targeted tax relief is on hold while Democrats try to get a handle on which portions of a $4 billion economic development bill they are comfortable moving forward on.

Gov. Charlie Baker earlier in his career favored reducing the sales tax to 5 percent, but the idea never got traction among the Democrats who hold super-majorities in the House and Senate.

Doughty pitched some aspects of his plan as a way to alleviate immediate stresses on household budgets, like temporary suspension of the gas tax and an elimination of the state’s 6.25 percent rolling stock tax.

He said he would push to suspend the motor fuel tax for “at least six months, so that people’s pocketbooks can catch up to inflation.”

The rolling stock tax, which applies to sales of trucks that transport goods across state lines, is “not well known” but is “one of the reasons that it costs more for groceries, costs more for goods here in Massachusetts,” Doughty said.

Bills to stop taxation of rolling stock have been filed in recent sessions, such as in 2019 when the measure was sponsored in bipartisan fashion by House Minority Leader Bradley Jones and Senate Ways and Means Chairman Michael Rodrigues.

Doughty’s plan also calls for dropping the corporate tax rate from 8 percent to 7 percent over four years, which he said would “reflect to the business community that Massachusetts is open for business” and that “the days of Taxachusetts are coming to an end.”

The Wrentham businessman called the Bay State’s unemployment insurance tax rate the “highest in America” and an “outlier” that deters businesses looking to relocate here. A campaign document said Doughty would “submit legislation to reform the UI tax” in an effort to “reduce costs to businesses by at least 15%.”

He said he also wants to increase the state’s earned income tax credit, for families earning less than $57,000, from 30 percent of the federal credit to 40 percent as a tax reform that “applies to everyone that is low-income.”

Asked about some of Baker’s other targeted tax proposals, like an increase to the renter’s tax deduction, Doughty referred back to the EITC boost as a type of simplified umbrella to give a break to all low-income taxpayers.

Doughty also said he would not touch the current personal income tax rate of 5 percent, would continue a commitment to fully funding local aid to municipalities, and supported Baker’s proposal to double the estate tax threshold.

The News Service reached out to the two other gubernatorial campaigns for their tax platforms.

A spokeswoman for Attorney General Maura Healey, the lone Democrat left in the governor’s race, pointed to Healey’s proposed child tax credit of $600 per child for families.

Healey “also supports expanding the Earned Income Tax Credit and rental deduction and increasing the estate tax threshold,” spokeswoman Karissa Hand said.

In a statement, Republican candidate Geoff Diehl called himself “a consistent and vocal advocate for tax relief” and referred to his 2014 leadership on the ballot initiative to repeal a law that automatically tied the gas tax rate to inflation. Like Doughty, Diehl has called this year for suspension of the state gas tax.

“I also support the Baker tax cut proposals, and I’m very disappointed that they were not acted on by the Legislature prior to the end of session,” Diehl wrote.

The former representative from Whitman also aimed frustration at the Legislature for the fact it “has not acted quicker to refund surplus revenue to taxpayers given a relevant 1986 law,” referring to Chapter 62F, although relief under 62F would be triggered by a report from the state auditor which is due Sept. 20.