Gov. Patrick Budget Eliminates 44 Tax Deductions
While some specific deductions would end, personal exemptions would double under the Patrick budget.
A recent analysis of Gov. Deval Patrick's proposed budget indicates it would eliminate 44 tax breaks that benefit a large slice of Massachusetts taxpayers.
Patrick's $34.8 billion fiscal 2014 budget includes not only a 1 percentage point hike in the income tax – from 5.25 percent to 6.25 percent – but the end of such deductions for capital gains from the sale of a person's primary home, college tuition and contributions to a health savings account.
Under the plan, the Commonwealth would raise an additional $1 billion from eliminating the deductions, according to the anaylsis.
Patrick's assistant secretary for fiscal policy, Gregory R. Mennis, told The Republican that that amount would be offset by the doubling of personal exemptions, which benefits all taxpayers.
Another key aspect of Patrick's plan is the lowering of the sales tax from 6.25 percent to 4.5 percent.
About half of Massachusetts households – in particular those earning less than $60,000 a year – would see their tax liabilities remain the same or drop, by Mennis' calculations.
"It's important to look at the tax package as a whole," Mennis told The Republican.
Patrick said he wants to make the tax code simpler and fairer, with the tax burden shifting from the lower and middle classes to the more affluent.
The bill is being reviewed by the House, which will release its budget proposal in April.