BLOOMBERG: Boston Business Leaders Back Tax-Cut Ballot Proposals for 2026

By Greg Ryan

This article originally ran in Bloomberg on August 6, 2025.

A coalition of Massachusetts business organizations is pushing for two new tax-relief proposals to appear on the ballot in the 2026 election, arguing the state’s high costs are undermining its economic competitiveness.

The leaders of the Massachusetts High Technology Council, the local chapter of the National Federation of Independent Business and the Retailers Association of Massachusetts were among the first signatories on a measure announced on Wednesday that would gradually reduce the state income tax to 4% from the current rate of 5%. A separate proposal that the business groups are also supporting would limit how much tax revenue can be collected in any given year.

The ballot questions still have a long way to go. Any measure put in front of voters must first be deemed constitutional by the state attorney general’s office. Then its supporters need to collect signatures from more than 85,000 Massachusetts residents.

It’s been more than a decade since the last successful ballot campaign to cut taxes in Massachusetts — a repeal of a law that tied the gas tax to inflation. In 2022, voters approved a so-called millionaires tax on personal income over $1 million.

Business leaders expect that the toll from high inflation in recent years will bolster support for a tax cut this time around. Boston-area executives have increasingly warned that the region’s high cost of living undermines its economic appeal, motivating both residents and companies to move to lower-cost locales. A decade ago, Massachusetts was smack in the middle of the Tax Foundation’s national tax-climate rankings. Today, it’s rated 10th-worst.

“The state budget has been continuing to grow at a rate much greater than household income, and ultimately that’s not sustainable,” Christopher Anderson, president of the Massachusetts High Technology Council, said in an interview. “There is widespread recognition that the multitude of taxes we’re dealing with in Massachusetts is creating a competitive barrier to growth.”

Three-quarters of Massachusetts residents support an income-tax cut, while a similar percentage back the cap on tax collections, according to a poll conducted in July by the Mass Opportunity Alliance, a group formed last year to advocate for a better business climate. While those making more than $100,000 a year expressed the strongest support for an income-tax cut, the measure was also popular among those who make less than $50,000 annually, the poll found.

The Opportunity Alliance consists of the technology council, the Pioneer Institute public policy research organization and the Massachusetts Competitive Partnership. Fidelity Investments Chief Executive Officer Abigail Johnson, New England Patriots owner Robert Kraft and State Street Corp. CEO Ronald O’Hanley are among the business leaders who sit on the board of the latter organization. While each executive doesn’t necessarily endorse every initiative, the Competitive Partnership harnesses their collective influence to press for changes to tax, workforce and other state policies.

While broad-based, the proposed income-tax cut would take some of the sting out of the millionaires tax. The surtax’s supporters and opponents regularly clash over whether the extra tax burden is causing high earners to leave the state, but the measure has yielded significant funds for education and transportation initiatives, including about $3 billion in the fiscal year that ended in June.

The second measure calls for capping the state’s tax revenue based on a target tied to annual wage and salary growth. Any collections above the limit would be refunded to taxpayers.

Massachusetts already has such a cap, thanks to a 1986 ballot question backed by the High Tech Council, but it’s only been triggered twice in the past four decades, most recently in 2022. The new proposal would lower the trigger to the point that residents would have received refunds 24 times in the past 40 years, according to an analysis from the Opportunity Alliance.

Ballot initiatives are often expensive, with supporters paying staffers to collect signatures and funding advertisements, mailers and other efforts to woo voters to their side. Proponents of the millionaires tax raised almost $29 million for that successful campaign.