MassBudget: Taxing The GILTI

In our latest tax series report, Taxing the GILTI, the Massachusetts Budget and Policy Center (MassBudget) highlights the impacts of corporate tax avoidance, and solutions to help bring this needed revenue back to the Bay State.

"Aggressive tax avoidance is a tactic often employed by large, multinational corporations and it's hurting our communities," said Marie-Frances Rivera, president of MassBudget. "At a time when there are calls for increased revenue to fund education and fix our broken transportation system, we can't afford to forfeit these dollars. Future generations are depending on us to do what's right."

Recognizing the scope and scale of this problem, federal lawmakers established a process for identifying some of this shifted income and then taxing a portion of it. The Global Intangible Low-Taxed Income (GILTI) provision allows the federal government and the states to recoup some of the tax dollars lost to aggressive corporate income shifting. "Currently, Massachusetts is not making full use of this powerful tool," said Kurt Wise, senior policy analyst and author of the report. 

"Recoupling to the GILTI provision would level the playing field for corporate taxpayers and would allow the Commonwealth to collect millions in tax dollars now lost to sophisticated accounting tricks."

Key findings in this report include:

• The federal government has created a tax provision, GILTI, to combat this abusive tax planning;
• Massachusetts lawmakers decoupled from this federal provision in 2018. Instead of taxing 50 percent of GILTI, as the federal provision does, Massachusetts now taxes only five percent;
• If lawmakers now choose to recouple to the federal provision, the Commonwealth stands to gain up to $450 million in additional revenue each year;
• Fourteen states - including ME, VT, NH and RI - have adopted the federal GILTI provision, taxing 50 percent of GILTI; and,
• States are on solid constitutional footing when taxing the GILTI, backed by multiple rulings of the U.S. Supreme Court dating back to the 19th Century.

To learn more about how the Commonwealth can combat abusive income shifting by large, multinational corporations, read the full Taxing the GILTI report here Bit.ly/TaxGILTI

For the full infographic
http://massbudget.org/reports/pdf/GILTI%20Infographic.pdf

For other resources, like our Gas Tax: What Is It and Who Pays fact sheet and more, visit our tax homepage here  http://massbudget.org

The Massachusetts Budget and Policy Center (MassBudget) produces policy research, analysis, and data-driven recommendations focused on improving the lives of low- and middle-income children and adults, strengthening our state's economy, and enhancing the quality of life in Massachusetts.

What is GILTI?

"The Global Intangible Low-Taxed Income (GILTI) provision was created to combat corporate tax avoidance. Many large, profitable U.S. multinational corporations go to great lengths to reduce their taxes."

MassBudget: Taxing The GILTI

In the News: tax cut will reduce state tax revenues; La Salette opens for 65th year

From the Milford Daily News, articles of interest for Franklin:

"In 2000, Massachusetts voters handily approved a ballot question meant to reduce the state’s income tax rate to 5%.

Two decades later, they’re finally getting their wish.

Republican Gov. Charlie Baker announced last week that on Jan. 1, the income tax rate will be cut from 5.05% to 5%.

The tax cut marks the end of a process that began in 2002 following passage of the ballot question two years earlier."

Continue reading the article online (subscription may be required)
https://www.milforddailynews.com/news/20191215/mass-taxpayers-to-see-tax-cut-okd-back-in-2000

"For 65 years, the Christmas Festival of Lights at La Salette has helped illuminate the reason for the season while providing delight and beauty for countless visitors.

The Rev. Flavio Gillio loves to light up the night. After all, that’s his job; he is the director of the National Shrine of Our Lady of La Salette in Attleboro. Each year, he is responsible for making sure the 300,000 lights and scores of holiday displays at the religious site shine brightly. As you might imagine, it’s a lot of work.

“Tis the season! ’Tis the season! Yes, we are very busy!” chuckles Father Flavio in a soft Italian accent. The priest in the Missionaries of Our Lady of La Salette was born in a small town near Turin in Italy, across the valley from the village in France where Mary was said to have appeared to two young children in 1846."

Continue reading the article online (subscription may be required)
https://www.milforddailynews.com/news/20191211/lighting-up-night-christmas-festival-of-lights-at-la-salette-is-welcoming-place

MassBudget: Businesses Avoid $1.4 Billion in 2019 Tax Amid Decades-Long Decline in Corporate Income Tax Share

New MassBudget Report Analyzes the State of Corporate Taxes in the Commonwealth

Businesses Avoid $1.4 Billion in 2019 Tax Amid Decades-Long Decline in Corporate Income Tax Share Despite rising corporate profits, taxes on those profits deliver smaller share of MA tax total Over the past 40 years, revenue collected from corporate excise and related taxes has dropped by a third as a percentage of total state tax revenue in Massachusetts, according to the latest report from the Massachusetts Budget and Policy Center (MassBudget). At the same time, the report finds, corporations across the nation are claiming an ever-growing share of all the income generated in the U.S. According to the report, Rising Profits, Falling Tax Shares: Fixing What's Broken, multiple factors have contributed to the long-term decline in the share of state taxes provided by corporate income taxes. The tax rate on most corporate income in Massachusetts was reduced from 9.5 percent to 8 percent between 2009 and 2012. Growth in the number and cost of state special business tax breaks also has played a role, as have increasingly aggressive tax avoidance efforts by corporations. Key report findings include:  During the last decade, Massachusetts corporate income and related taxes delivered an average of 10.6 percent of total state tax collections, compared to an average of 16 percent in the 1980s; Businesses would have contributed another $1.4 billion in taxes to the Commonwealth in FY 2019 had Massachusetts' corporate excise tax collections remained at the share of total taxes they provided throughout the 1980s (about 16 percent of the total); Massachusetts corporations are seeing a reduction in their annual federal tax bills of around $4 billion due to the 2017 Tax Cut and Jobs Act;  Massachusetts is in the bottom fifth of all states in terms of the share of total state and local taxes paid by businesses "At a time when profits are soaring, taxes on those profits should not be delivering a smaller slice of our total tax pie. Kids, commuters and communities across the state need profitable corporations doing business here in Massachusetts to step up and do more, not less," said Marie-Frances Rivera, President of MassBudget. Interested in learning about state-level policy options that would help restore the share of state taxes collected through taxing corporate income? Read the full Rising Profits, Falling Tax Shares report, click here.   http://massbudget.org/report_window.php?loc=Rising%20Profits%20Falling%20Tax%20Shares.html Other reports from our series on corporate taxes have been flagged on our website here.  http://massbudget.org/taxes.php The Massachusetts Budget and Policy Center (MassBudget) produces policy research, analysis, and data-driven recommendations focused on improving the lives of low- and middle-income children and adults, strengthening our state's economy, and enhancing the quality of life in Massachusetts. MASSACHUSETTS BUDGET AND POLICY CENTER 1 STATE STREET, SUITE 1250 BOSTON, MA 02109

Massachusetts Budget and Policy Center, 1 State Street, Suite 1250, Boston, MA 02109 Sent by kwise@massbudget.org in collaboration with Try email marketing for free today!

MassBudget: Statement on Proposed Gas Tax Increase

October 30, 2019 Statement on Proposed Gas Tax Increase  Statement by Marie-Frances Rivera, Massachusetts Budget and Policy Center President, in response to discussions on increasing the gas tax:  With congested highways, antiquated public transit, and limited transit options outside of Greater Boston, the Legislature and business community are debating the merits of increasing the gas tax to modernize our state's transportation system. It is critically important to understand that not only would this increase hit low and middle income communities the hardest but it would draw on a source of transportation revenue that will likely decline over the long term. Our report, 14 Options for Raising Progressive Revenue, outlines a variety of fair and sustainable ways we can raise revenue, including raising corporate taxes. These options ask those who are benefiting most from economic growth to contribute a little more to help bring our transportation system into the 21st century. If policymakers decide to raise the gas tax, increasing and expanding worker tax credits, such as the Earned Income Tax Credit, can create a financial buffer for some who would be hardest hit by a gas tax increase. Interested in learning more about the pros and cons of higher gas taxes? Read our latest report here. The Massachusetts Budget and Policy Center (MassBudget) produces policy research, analysis, and data-driven recommendations focused on improving the lives of low- and middle-income children and adults, strengthening our state's economy, and enhancing the quality of life in Massachusetts. MASSACHUSETTS BUDGET AND POLICY CENTER 1 STATE STREET, SUITE 1250 BOSTON, MA 02109

Massachusetts Budget and Policy Center, 1 State Street, Suite 1250, Boston, MA 02109 Sent by rwilliams@massbudget.org in collaboration with Try email marketing for free today!

Franklin Election 2019: What does the Board of Assessors do?

While the Town Council votes to set the tax rate annually, the calculations on what the tax rate should be are based upon the valuations of all the commercial, industrial, residential, and personal property that Franklin has record of. These calculations are performed by the Assessors under the oversight of the elected Board of Assessors.

The state has changed the requirement for a property revaluation from every three years to every five years.

There are three members of the Board. Two positions are up for election this year. All three positions are four year terms of office and staggered to avoid a complete replacement and loss of institutional knowledge.

From the Town of Franklin Board of Assessors page
http://www.franklinma.gov/board-assessors

Mission
Establish and maintain valuations for all real and personal property within the community for purposes of generating tax revenues.

Services and Programs
Valuation, classification and assessment of all real and personal property for tax purposes. Conduct research of real estate market (including sales and ratio studies); prepare sales and other reports for state review and certification of values. Prepares and certifies abutters lists. Processes abatements, liens, and apportionment. Maintains assessors' maps, plans, property transfer records, and valuation data. Processes all real and personal property abatements and exemptions. Processes and abates motor vehicle excise. Prepares data for state approval of tax rate.

Inquiries regarding the valuation of residential property, industrial and commercial valuations, or questions about personal property valuations should be directed to Kevin W. Doyle, Peter Mooney or David Ruberti.

Questions regarding abatement and exemption applications, abutters lists, motor vehicle excise, ownership of real and personal property and general assessment data should be directed to the clerical support staff.

The Board of Assessors section in Franklin Annual Report for 2018 can be found
https://www.franklinmatters.org/2019/02/franklin-annual-report-2018-board-of.html

Find more information on the Franklin Election Nov 5, 2019 in the "election collection"  
https://www.franklinmatters.org/2019/07/franklin-election-collection-2019.html 

Franklin Election 2019: What does the Board of Assessors do?

  

“I do think it’s important that we’re involving the public as much as possible”

From the Milford Daily News, articles of interest for Franklin:

"The Senate working group formed to take a deep dive into tax policy and recommend ways to modernize and update the tax code will hold closed meetings, according to its chairman. 

Sen. Adam Hinds of Pittsfield, who also co-chairs the Joint Committee on Revenue, told the News Service that the working group will hold six regional hearings to take public testimony but will keep its monthly business meetings closed in an effort to facilitate “honest conversation” among group members. 

“It’s my inclination to do it this way,” said Hinds, who has described the group’s charge as modernizing and simplifying the state tax code by recommending legislative changes for consideration in the 2021-2022 legislative session. 

The group’s first meeting is set for 2 p.m. on May 15 in the Senate Reading Room. Its members include a former lieutenant governor and revenue commissioner, representatives of big businesses and labor unions, and several appointees who favor changes to boost revenue and make taxes fairer for low-income workers."

Continue reading the article online (subscription may be required)
https://www.milforddailynews.com/news/20190506/state-senate-to-lead-closed-meetings-on-tax-policy-changes-to-facilitate-honest-conversation

From the archives, the original announcement of the Senate Revenue Working Group  https://www.franklinmatters.org/2019/04/senate-president-spilka-chair-hinds.html

Senate President Karen Spilka announces the members of the
Senate Revenue Working Group, chaired by Senator Adam Hinds

In the News: Robert “Sully” Sullivan; Milford Regional expands; all transportation revenue options are still “on the table”

From the Milford Daily News, articles of interest for Franklin:

Robert “Sully” Sullivan

"For Jack Lank, president of the United Regional Chamber of Commerce in Plainville, the visual of Robert “Sully” Sullivan, in a red Santa suit and hat patrolling through Franklin in his red convertible, is a lasting memory. Sullivan used to joke that he also had the physique for it, said Lank. 

Sullivan, Franklin’s beloved Santa Claus and co-founder of the Santa Foundation, died Monday at Whittier Hospital in Westborough. He was 70. 

“It’s a tremendous loss to the community, and a tremendous loss for all the families that he has helped over the years,” said Lank, who worked with Sullivan on his Santa Foundation for 10 years, calling him a “town icon.” 

“He was one of the kindest individuals you would ever meet, and he never said no,” said Lank.

Continue reading the article online (subscription may be required)
https://www.milforddailynews.com/news/20190426/franklin-town-icon-dies-at-70

Santa Foundation

Milford Regional expands in Franklin

"Things have gotten a little easier for Franklin-area residents who use services and physicians at Milford Regional Medical Center. 

The Milford-based hospital opened a new building at 1280 West Central St. in Franklin earlier this month. 

“Franklin is a huge, important part of our service area,” said Teri McDonald, vice president of public relations, marketing and communications at Milford Regional Medical Center. ”(The new building is) going to be a great improvement for the area.” 

The location consolidates four medical practices previously scattered throughout Franklin, expands the hospital’s diagnostic imaging and laboratory services, and adds an urgent care center."

Continue reading the article online (subscription may be required)
https://www.milforddailynews.com/news/20190426/franklin-gets-centralized-milford-regional-medical-center-service


all transportation revenue options are still “on the table”

"Expanding road tolls across Massachusetts and to the state’s borders could be a way to generate new revenue to address growing transportation woes, Senate President Karen Spilka said Thursday. 

In remarks at a Greater Boston Chamber of Commerce breakfast Thursday, Spilka, an Ashland Democrat, told business leaders that tolls similar to those along Interstate 90 deserve consideration for other places. 

“Simply put, and I put this out there, if tolls are a good idea for my district, my region, I believe we should explore the possibility of expanded tolling, including possibly at our borders,” Spilka said. “Our best ideas won’t matter if we can’t find a way to make a 21st century transportation infrastructure a reality — and find a way to pay for it.”

Continue reading the article online (subscription may be required)
https://www.milforddailynews.com/news/20190425/spilka-more-tolled-roads-deserve-consideration

Senate President Spilka, Chair Hinds Announce Members Of Revenue Working Group & Convene First Meeting

On Tuesday, the Massachusetts Senate announced the members of its Revenue Working Group during a press conference in the newly renovated Reading Room, adjacent to the historic Senate Chamber in the State House. Immediately after the press event the Revenue Working Group convened its first meeting.

Chaired by State Senator Adam G. Hinds (D- Pittsfield), who serves as the Senate chair of the Joint Committee on Revenue, the establishment of the Senate Revenue Working Group fulfills a vision first outlined by Senate President Karen E. Spilka (D- Ashland) during her inaugural address to Senate members on January 2, 2019.

“I am excited to be working with Senator Adam Hinds and the many distinguished members of the Revenue Working Group to take a close and comprehensive look at how our tax code is structured in Massachusetts,” said Senate President Spilka. “With all of the changes to how we live and work these days, it is important to see what is working, what is outdated, where we can improve, and how we can create a revenue system for the Commonwealth that is fair and functional for all of us. I am confident that we will find a way to continue to provide for the economic vibrancy of Massachusetts while allowing us to care for each other and fund our priorities.”

The Revenue Working Group is charged with assessing the existing Massachusetts revenue system and exploring ways to update and improve it, with the primary goal of ensuring the Commonwealth’s system of revenue collection generates sufficient funds in a predictable, sustainable and fair manner while contributing to a vibrant and competitive economy and ensuring taxpayer accountability.

As outlined by the Senate President, the Revenue Working Group is a part of the existing robust dialogue on the state’s current revenue system and tax policy on Beacon Hill, and will operate as a parallel effort with the Joint Committee on Revenue. Information gathered by the Working Group will help inform decisions made by Senator Hinds in his capacity as co-chair of the Committee during this legislative session, and will be available to Revenue Committee members and staff.

The Working Group will meet throughout the 2019-2020 legislative session, convene public forums in various locations across the state and recommend policy changes for future consideration by the Massachusetts Legislature. Legislative recommendations are not expected to be filed for consideration until 2021. The ongoing efforts of the Working Group throughout 2019-2020 is not expected to hinder legislative and policy decisions that may come before the House of Representatives and Senate during this legislative session.

“The members announced today are a deliberately inclusive, bipartisan and talented group representing business leaders and workers, non-governmental leaders and grassroots advocates, professors and tax attorneys,” said Senator Hinds. “Each brings a unique perspective and a lot of experience to the Working Group that I believe will ensure any recommendations that result from our efforts will be capable of gaining wide acceptance. My hope is that at the conclusion of our review of the tax code, the Working Group will make recommendations that are positive for working families and small businesses, and support economic growth and vital government investments in Massachusetts.”

The 21 members of the Senate Revenue Working Group announced were:

• Senator Adam G. Hinds, Chair, Senate Revenue Working Group
• Senator William Brownsberger (D- Belmont), Senate Vice Chair of the Committee on Revenue
• Frank Callahan, President, Massachusetts Building Trades Council AFL-CIO
• JD Chesloff, Executive Director, Mass Business Roundtable
• Nancy Creed, President, Springfield Regional Chamber
• Peter Enrich, Professor of Law, Northeastern University School of Law
• Deb Fastino, Executive Director, Coalition for Social Justice
• Senator Ryan Fattman (R- Sutton), Member, Joint Committee on Revenue
• Christina Fisher, Executive Director for Massachusetts and the Northeast, TechNet
• Hilary Bacon Gabrieli, Tax Policy Attorney
• Harris Gruman, Executive Director of the SEIU Massachusetts State Council
• Beth Huang, Director, Massachusetts Voter Table
• Eileen McAnneny, President, Massachusetts Taxpayers Foundation
• Tim Murray, President & CEO, Worcester Regional Chamber of Commerce
• Amy Pitter, President & CEO, Massachusetts Society of CPAs
• John Regan, Executive Vice President of Government Affairs, Associated Industries of Massachusetts
• Mayor Dan Rivera, City of Lawrence
• Marie-Frances Rivera, President, Massachusetts Budget & Policy Center
• James E. Rooney, President & CEO, Greater Boston Chamber of Commerce
• David E. Sullivan, Attorney
• Steven A. Tolman, President, Massachusetts AFL-CIO

It is the tradition of the Massachusetts Senate to, at times, establish working groups, independent of the Joint Committee process, to conduct robust assessments of key policy areas. This session, at the direction of President Spilka, the Senate is also convening working groups on Transportation and Mental Health.

Senate President Karen Spilka announces the members of the
Senate Revenue Working Group, chaired by Senator Adam Hinds

MassBudget: For Tax Day: A Round-Up of Recent Tax-Related Reports

MassBudget    Information.    Participation.  Massachusetts Budget and Policy Center    Democracy. April 15, 2019 For Tax Day: A Round-Up of Recent Tax-Related Reports Our Commonwealth's current prosperity depends, in no small part, on the investments that earlier generations made before us. Think of where we'd be if earlier generations hadn't invested in our subway system or the Massachusetts Turnpike - or if the Commonwealth hadn't committed to establishing the nation's first public school. Our state and our lives would look quite different today without those forward-thinking investments. Some of the most important things we do together through state and local government is educate our children, increase the mobility of our people through public transit and safe roads and bridges, and improve people's well-being through access to healthy foods, medical care, and other necessities. And, improving the quality of the education our children receive and the transportation infrastructure our communities rely on requires up-front investments for long-term pay-offs. Tax revenue helps fund these important priorities. For this year's income tax filing deadline, the Massachusetts Budget and Policy Center (MassBudget) is revisiting some of its recent papers related to the state's tax system. Here are some of the highlights:  Who pays state and local taxes in Massachusetts?  Massachusetts' tax system is upside-down, meaning it asks low- and middle- income taxpayers to contribute a larger percentage of their incomes in taxes than high-income taxpayers. http://massbudget.org/report_window.php?loc=Who-Pays-Low-and-Middle-Earners-in-Massachusetts-Pay-Larger-Share-of-their-Incomes-in-Taxes.html How do decades-old tax cuts affect our state today? The upside-down nature of our taxes were exacerbated by tax cuts from the late 1990s and early 2000s. These tax cuts, which today mean more than $4 billion in lost revenue per year, mostly helped the highest-income taxpayers. http://massbudget.org/report_window.php?loc=Income-Tax-Cuts-Cost-Massachusetts-Over-$4-Billion-Annually.html What are ways to help turn our tax system right-side up? But there are ways to turn our upside-down tax system right-side up. MassBudget explored 14 options that would not require changes to the State Constitution. http://massbudget.org/report_window.php?loc=14-Options-for-Raising-Progressive-Revenue.html For more information on the state's tax system and other policies that affect the lives of low- and middle-income people in Massachusetts, visit massbudget.org. Or follow us on Twitter or Facebook. The Massachusetts Budget and Policy Center (MassBudget) produces policy research, analysis, and data-driven recommendations focused on improving the lives of low- and middle-income children and adults, strengthening our state's economy, and enhancing the quality of life in Massachusetts.

Massachusetts Budget and Policy Center, 15 Court Square, Suite 700, Boston, MA 02108 Sent by mrivera@massbudget.org in collaboration with Try it free today