By State Representative George N. Peterson, Jr.
Too often do I encounter an eye roll or a scoff when I, or my Republican colleagues in the Massachusetts State House, voice my opposition to a tax increase. This either has to do with being a Republican in Massachusetts, or the fact that people automatically assume Republicans are going to be against any sort of increase in revenue. However, there is often a method to our madness, and the technology tax is a perfect example.
If you care to join me for a trip down memory lane, I would like to take you back to April when Governor Deval Patrick released his $1.9 billion transportation finance proposal. In this proposal was a tax on the bread and butter of the Massachusetts economy – the technology sector. As soon as my Republican colleagues and I discovered this ill-conceived and ill-timed tax on certain software services, we began to raise the red flag.
Unfortunately in Massachusetts, numbers in the Legislature don’t favor Republicans. We knew we had our work cut out for us, but we also knew that in a state which thrives on the services rendered by the high-tech industry, this tax would not only stifle the Commonwealth’s entrepreneurs, but would have a detrimental trickle-down effect on residents and customers alike. We were determined to have our voices heard on behalf of the technology industry and the taxpayers of Massachusetts.
Our opposition was vehement and our effort was relentless. In early April, the Republican Caucus in the House of Representatives went as far as to propose an alternative transportation plan. However, unlike previous proposals which relied heavily on tax revenue, the legislation offered by House Republicans was free from any attempt to raise taxes on Massachusetts residents. Again, back to the numbers game, our proposal was defeated. While this was another loss for the taxpayers and technology sector, we would not be deterred.
Later in April, a $500 million transportation plan offered by the Speaker of the House and the Senate President was adopted in the House of Representatives. The plan, opposed by Republicans, included the tax on the innovation economy. After being adopted in the Senate, and some back and forth with the Governor, the transportation finance legislation was signed into law, and the tax on the high-tech industry was complete – or so they thought.
Republicans were persistent in our opposition to the technology tax. Just because it was signed into law did not mean we were going to give up. We immediately went back to the drawing board, and in early August embarked on a series of eight technology tax business roundtables. Announced as part of a concerted effort by the Massachusetts House and Senate Republican Caucuses to repeal the crippling technology tax at the legislative level, the weeklong series of roundtable discussions included conversations with technology industry professionals and representatives from area Chambers of Commerce.
Upon completing our roundtables, House and Senate Republicans held a press conference at Genuine Interactive, a leading interactive agency, to unveil legislation to repeal the Democrat-approved job-killing computer services tax. The legislative measure, which contains the same language as the ballot question recently approved by Attorney General Martha Coakley, is just the latest effort the minority party put forth to eliminate this unprecedented tax.
Earlier this month, in a complete 180 from April, the Governor, Speaker of the House, and Senate President announced their intention to join the Republican Caucus, and repeal the technology tax. This epiphany from Democratic Leaders is a testament to the hard work of legislative Republicans, the technology sector, and citizens from around the Commonwealth. Our voices were heard – a tax on the technology sector is reckless.
The next time Republicans stand up to a tax increase don’t automatically roll your eyes; we are probably on to something!
State Representative George Peterson, Jr. (R-Grafton) serves as the Assistant House Minority Leader in Massachusetts. He represents the 9th Worcester District which includes the towns of Grafton, Northbridge, and Upton.
Rep. George N. Peterson, Jr.
House Assistant Minority Leader
State House, Room 124
Boston, MA 02133
legislative aide: David Muradian