Taxes still on table as House prepares budget unveiling
BOSTON (SHNS) – The House budget chief declined Monday to rule out tax increases as he prepared to roll out a budget plan.
A week before releasing a redraft of Gov. Maura Healey's $62 billion fiscal 2026 budget, House Ways and Means Chairman Aaron Michlewitz initially dodged the tax question but then said taxes remain on the table.
'Certainly everything's still on the table for conversation,' he said, after initially telling reporters outside his office that 'you'll hear more about that in the coming days' when asked about tax changes in the budget.
'We're trying to build a budget that is fiscally sound and also allows us to be able to pivot if necessary based off a lot of these challenges that we're seeing from the federal government, from a financial standpoint a lot of uncertainty,' Michlewitz added. 'And then certainly with this tariff situation, top down with the affordability crisis that we're facing, we certainly are taking that all into consideration.'
Healey's budget was up for a public hearing in Attleboro on Monday and its final hearing is planned for Tuesday. Michlewitz said he wanted to wait for the hearings to wrap up before making final determinations on taxes.
'Once that happens, you'll hear more of those conversations,' he said.
House Speaker Ronald Mariano in late March said House Democrats would not adopt Healey's plan to add new taxes on prescription drugs, appearing to take off the table more than $200 million in proposed levies. He also indicated the House would likely not pursue Healey's idea to apply the sales tax to candy.
Raise Up Massachusetts, the coalition behind the income surtax on wealthy households that voters approved in 2022, is lobbying this year for a 'corporate fair share' tax package that would target businesses that use 'offshore tax havens' to steer profits overseas. Taxing these corporations the same way that other states do could yield hundreds of millions of dollars in new funding for Massachusetts, according to the coalition.
Michlewitz said estimated tax returns and non-withholding tax data in recent months suggest another income surtax surplus tied to fiscal 2025 is in the works.
'We will probably have a good amount of surplus next year based off how the numbers are coming in so far,' he said. 'We won't know those finalized until summertime, or some point.'
With financial markets tanking on news of President Donald Trump's efforts to reshape global trade through tariffs, some analysts say budgetary support from the surtax and capital gains taxes will dry up and believe lawmakers need to immediately write down tax revenue estimates for the budgets they are about to debate.
'It's hard to predict,' Michlewitz said. 'Obviously the unpredictability and kind of the fluidness that's going on right now within the federal government is going to cause a lot of concern, and if that changes anything we'll have to react to it.'
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