TaxWatch: In the midterm elections, voters in California and Massachusetts must decide if millionaires should pay more tax — which way would you vote?

by | Oct 28, 2022 | Stock Market

In the run up to the midterm elections where costs are top of mind for many people, voters in Massachusetts and California are being asked to decide if millionaires in their states should taxed more to help pay for large-scale public goals like improved infrastructure and widespread electric vehicle purchases. A ‘yes’ vote in Massachusetts’ Question 1 would add a 4% surtax for households making at least $1 million. The Bay State has long had a flat-rate income tax, now at 5%. The money would be tied to education and infrastructure spending.

Two different Massachusetts polls, both conducted earlier this month, show voters supporting Question 1’s extra 4% tax. A ‘yes’ vote in California’s Proposition 30 puts a 1.75% surtax on income above $2 million. The state already has a top rate of 13.3%, the steepest rate for a state income-tax code. The revenue on the 20-year tax would go towards zero emission vehicle purchase incentives for consumers and businesses. It would also bring in more money for charging stations and wildfire prevention. California polling shows a tightening race. While one poll from early October showed 49% of voters backing Proposition 30 versus 37% in opposition, a more recent poll showed more than half (52%) of people likely voting against the measure with 41% in support.

“A ‘yes’ vote in Massachusetts’ Question 1 would add a 4% surtax for households making at least $1 million.”

Does that means tax hikes for the rich from two reliably Democratic states? Not so fast, say observers. Polling suggests Democrats up and down the ballot may be playing defense to many Republican candidates. Besides, forecasting the outcomes on tax-related ballot measures is a tricky business. Such votes are not easy to predict. “Income-tax changes have been 50/50 in past years,” said Jared Walczak, vice president of state projects for the right-leaning Tax Foundation. “Ballot results often surprise outside observers.” Two years before Massachusetts’ Question 1, voters in I …

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