Remember when the biggest rally turnouts in college centered on the students’ rights to drink on campus? When you mess with people’s alcohol, they come out in droves. The Massachusetts alcohol tax repeal helped bring voters to the polls yesterday.
2010 Massachusetts Ballot Questions
Question 1: Sales Tax on Alcoholic Beverages: Yes
Massachusetts voters voted yes and repealed the 2009 sales tax imposed on alcohol and alcoholic beverages. The repeal passed by a narrow margin overall and had the most support from the New Hampshire border towns. The repeal will cause a “$110 million in revenue” according to state finance officials. Yet last year there was a surplus in the budget. Last year’s surplus prompted Governor Patrick to sign a last-minute approval of the Sales Tax holiday in August.
Question 2: Repeal housing comprehensive permit law: No
Question 3: Sales and Use Tax: No
Massachusetts voted no on question 3, which will keep the 6.25% sales tax in place. Some are wondering why Question 1 passed and Question 3 did not. The answer is simple: Question 3 went too far. Question 3 sought to reduce the 6.25% sales tax down to 3%. Had the Question tried to take a baby step instead, and asked for a sales tax reduction from the current 6.25% to the pre-September 2009 rate of 5%, it would have had a better chance of passing. All Question 1 did was put things back they way they were before last year’s increase.
Is Massachusetts Really Taxachusetts?
Massachusetts first added a sales tax in 1966, according to the Mass Budget and Policy Center. Massachusetts has often been called “Taxachusetts.” Massachusetts is one of the few states that don’t allow “local option” taxes on top of sales taxes. Local option taxes add yet another layer of taxation to residents.
Compared to other states, Massachusetts residents are on the lower end of the scale in terms of the percentage of their income they pay in general sales tax. In 2006, Massachusetts ranked 45th with 1.4 percent of residents’ total income going to sales tax, compared to Louisiana at the top with 5.6% of personal income going to general sales tax.