WORCESTER TELEGRAM: One-two ballot punch can boost state’s growth

By Christopher R. Anderson

This piece originally appeared in the Worcester Telegram on September 21, 2025.

Massachusetts’ economy is in need of a boost. The state’s job growth is stagnating, and residents are leaving for lower-cost climates. Two proposed measures for the 2026 ballot — a tax cut and a cap on how much revenue the state can take in — could put the commonwealth back on track.

A decade ago, Massachusetts led the United States in job growth, powered by bipartisan cooperation and a light-touch regulatory burden. In 2015, our economy grew by 3.7%, stronger than the national average. Real personal income and employment growth were also well ahead of national rates.

This performance was even more impressive given the state’s less-than-impressive fiscal past. In the 1970s, the commonwealth had earned the nickname “Taxachusetts” thanks largely to its tax-and-spend mentality. Families fled, businesses avoided us, and our economy stagnated under crushing tax burdens.

But federal budget cuts during the Reagan administration forced Boston and other cities to cut spending. Voters also passed Proposition 2½, which limits local property tax increases. These changes helped spark the “Massachusetts Miracle” — a statewide economic revival that saw unemployment levels drop from 12% to less than 3%.

But out-of-control state spending, followed by tax increases, in the late 1980s threatened to undo the progress Massachusetts had made. In subsequent decades, tax cuts and more restrained spending helped the state’s economy (and tax revenue) grow.

But political memories are short, and our great commonwealth has been backsliding. Our state’s economic prosperity led to flush coffers and a legislative desire to spend more. Since 2018, the state’s budget spending has risen by more than 50%, or $20 billion.

The COVID-19 pandemic drove a lot of this increased spending, but state spending has been outpacing revenue growth even after the crisis passed. Even that isn’t enough for the state’s progressive groups: To pay for more priorities, they spent big in 2022 to narrowly secure passage of a surtax on those earning over $1 million annually.

The data shows we are already paying the price. The year the surtax passed, the state lost over 45,000 residents and nearly $4 billion in adjusted gross income, according to IRS data. For employers, rising cost pressures are making it increasingly hard to compete, with CNBC recently ranking the state as the second-worst in the nation for the cost of doing business.

It’s not just higher earners and business owners who are feeling the pinch: One recent poll found that 82% of residents believe their taxes are too high, and two-thirds named the high tax burden as a top reason people are fleeing the commonwealth.

Two big ideas for the 2026 ballot could turn the tide.

The first would cut the state income tax from 5% to 4%. Since 2021, over half of U.S. states have cut income tax rates. Massachusetts was the only state — along with Washington, D.C. — that did the opposite. In that same time frame, Massachusetts became one of only four states to lose private-sector employment.

A recent economic analysis by the Mass Opportunity Alliance estimates this tax cut would save the average taxpayer about $1,300 annually. The same analysis projects that the proposed tax cut could boost Massachusetts’ gross domestic product by up to $17.5 billion within three years of full implementation.

At a time when home prices are skyrocketing and persistent inflation threatens jobs across the state, that kind of relief would be a game changer — not just for families but also for the small businesses and the local communities they support. It should come as no surprise that 75% of voters support the cut.

The second big idea would limit the amount of revenue the state could take in, encouraging fiscal responsibility and returning more money to taxpayers. Massachusetts voters already enacted a revenue cap 40 years ago, but it has only resulted in refunds to taxpayers twice over that time period.

A proposed reform would strengthen this cap, resulting in an estimated billions of additional dollars returned to taxpayers in the years ahead. In fact, if this policy had been in place from the start, Massachusetts residents would have received refunds 24 times over the same period. It’s a change three-fourths of voters support.

Massachusetts thrived when it embraced pro-growth policies and fiscal discipline — and it can again. Cutting the income tax and strengthening the revenue cap are commonsense reforms with bipartisan support. If we want to reverse our economic decline, the path forward is clear: Trust taxpayers, rein in spending and choose prosperity.

Christopher R. Anderson is president of the Massachusetts High Technology Council and a co-organizer of the Mass Opportunity Alliance.