Vote Yes on Ballot Question One

This staff editorial is part of The Crimson Editorial Board’s 2022 Massachusetts Election Guide. See the full guide here.

On November 8th, 2022, Massachusetts voters will vote on Ballot Question One, a proposed amendment to the state constitution that would amend the state’s flat income tax by creating a “millionaires tax” surcharge on our highest earners. The Crimson Editorial Board urges voters, at Cambridge and beyond, to vote yes on question one.

The proposed amendment — which already passed through the state’s General Court joint sessions in 2019 and 2021 — would leave the vast majority of Massachusetts residents unscathed. In that sense, its impact would differ substantially from the ominous framing employed by ‘Coalition to Stop the Tax Hike.’ If approved, question one would change the marginal tax rate of residents making over $1 million annually by adding a 4 percent surtax on income above the threshold. As of today, our state employs a (highly regressive) flat 5 percent income tax; residents with incomes below $1 million would still face that 5 percent rate, while the state’s few millionaire earners would be subject to a 9 percent rate on all earnings above the threshold.

To put that into perspective: For anyone lucky enough to earn, say, $1.5 million, the $500,000 above the million dollar mark would now be taxed at a 9 percent rate, increasing their tax bill by $20,000, with the additional state revenue earmarked for public education, infrastructure, and transportation expenses.

We find question one’s tax increases not only unobjectionable but blatantly beneficial — if not for a tiny handful of Beacon Hill high earners, for everyone around them who, through their consumption and labor, tacitly enables such exorbitant earnings. If a meager 4 percent rise in your marginal tax rate can increase your state-level tax bill by a figure equivalent to others’ annual income, odds are you should probably be taxed.

Question one’s impact must be contextualized within Massachusetts’ heavily unequal society. For the average Massachusetts resident, who has a median household income of just over $84,000, one million annual dollars is a distant figure, one that will not be reached within their lifetimes — no matter how much deeply delusional conceptions of America’s upwards mobility suggest otherwise. Indeed, only an estimated 20,000 to 25,000 out of almost seven million bay staters. Less than seven out of every 1,000 Massachusetts households would face any sort of tax hike, yet the remaining 993 (plus, presumably, the newly taxed seven) would experience a substantial increase in available funding for public services.

For those with these sorts of exorbitant incomes, the increased tax will certainly be felt, but it will hardly be meaningfully detrimental to their economic status. That hasn’t stopped advocates for the oppressed wealthy from furthering disingenuous arguments. They include, among others, the concern that ‘one-time’ millionaires, who report an inflated income after the sale of a property, will face an oppressive tax rate on their nest eggs. What about the endearing, not well-off elderly who just so happen to own a million-dollar house, opponents ask? Who on earth will protect them from our tyrannical fiscal system?

As it turns out, the answer is the system itself. The first flaw within that reasoning is the fact that owning a million-dollar nest egg already qualifies you as extremely well-off compared to the remainder of your state (and global) peers, and makes us comparatively less likely to be overly concerned about your socioeconomic survival. More crucially, Massachusetts doesn’t tax all income from property sales, but only the capital gains accrued (the difference between the purchase and sale price). Even if the difference between your purchase and sale price exceeds $1 million (which, again, we must emphasize will hardly be the case for the vast majority of residents), Massachusetts exempts the first $500,000 capital gains from taxation for married couples, and half that amount for single filers. If you and your partner bought a stunning Boston property for $1 million, and are now selling it for $2 million, only $500,000 of your net profit would be eligible for state taxation. Unless you make another half a million annually, the sale of your $2 million house would not push you into the increased-tax bracket — and, as a board, we feel comfortable encouraging the state to tax those who do in fact exceed those generous boundaries.

Anyone with combined incomes and property-sale capital gains (past the standard exemptions) above $1 million is, in our view, wealthy enough to be subject to additional taxation for the sake of increasing societal welfare.

As members of the overwhelmingly wealthy, overwhelmingly liberal Harvard community, we feel the need to emphasize the broader dynamics at play in the ongoing debate. We fear that the current debate is representative of national trends and that the reticence to vote yes by some of our fellow residents embodies concerning tendencies within our changing coalition. To state the obvious: As parties realign according to education, as they have in the United States, we run the risk that well-off, presumably liberal places like our own community engage in performative class politics while protecting their own interests. That might entail, for example, loudly arguing for taxing the rich while setting the bar for “rich” at such a high level that people who are objectively better off than 99 percent of the US population are excluded.

Tweeting about taxing Elon Musk and Jeff Bezos will always be easier than accepting taxes on your own, educated, liberal but objectively very well-off peers. But if your income on any given year is above a million, you are undeniably wealthy — and we are in favor of taxing that income to maximize social well-being. No meaningful welfare state will be built on the backs of billionaires alone; progressive taxes targeting “low-level” millionaires serve a crucial social purpose.

What is not harmful to the wealthy few might thus be hugely beneficial for the majority. Experts project that this small increase in taxes could procure $1.2 to $2 billion a year to invest back into the lives of all Massachusetts residents’ public infrastructure and education. If after the amendment’s passage its execution does not go as residents would like, there is always room for adjustment. But we still would rather pass it now, reap the substantial budgetary benefits, and make necessary adjustments later, than shut it down entirely.

Our reasoning here goes further than the frankly impressive benefits the state could reap if it puts the extra revenue to good use. Even beyond potential public investments, we are of the belief that taxing the wealthy is, generally speaking, good. Within a republic of supposedly equal citizens, excessive differences in income and wealth can create sharply unequal hierarchies and increase an elite’s power, until the presumed equality is limited in practical impact across every sphere — educational, political, and social. Taxation of the very wealthy is a good and necessary remedy.

Every new tax will have its critics. Some will point to resulting decreases in economic activity — though this tax will increase revenues enough to offset such decreases. Some will point to sympathetic edge-case hypotheticals — though we struggle to muster much sympathy for seven-figure homeowners who hope to escape the epithet of “millionaire” on a technicality.

We do wish that there was a better way to guarantee that additional revenue raised through this tax increase resulted in increased spending only on its stated priorities of public education and infrastructure. But this is a minor quibble that attaches broadly to almost any tax measure. The potential benefits of this amendment far outweigh the risks.

If spent well, additional revenue could prove transformative. We could have a functional orange line! We could decrease the funding gap between affluent suburban schools and majority-minority school districts that have too often been financially neglected by the state and disadvantaged by a system of local-tax-funded education. The stunning asymmetry between Massachusetts’ elite higher education and some of its struggling public schools needs to be rectified.

A vote against question one would represent a gross misunderstanding of the extent of inequality and suffering in a state where the average Black household wealth in the capital was estimated at a meager $8 in 2015 (that of white households was roughly a quarter of a million dollars). The beneficiaries are numbered by the millions, across generations, and stand to gain infinitely more than what the millionaires (even the ‘one-time’ millionaires) will lose.

On those grounds, out of solidarity with our entire state and the challenges our fellow residents face, we urge Massachusetts voters to vote yes on ballot question one.

This staff editorial solely represents the majority view of The Crimson Editorial Board. It is the product of discussions at regular Editorial Board meetings. In order to ensure the impartiality of our journalism, Crimson editors who choose to opine and vote at these meetings are not involved in the reporting of articles on similar topics.

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