Bill > H3005

This bill allows Massachusetts cities and towns to implement an optional local tax system based on income rather than property values. Specifically, the bill would enable municipalities to choose to assess local taxes on personal income and business income by adopting a new method of taxation through a vote of their local governing body. Under this system, cities and towns would calculate tax rates by determining the total resident income (TRE) and total commercial/industrial income (CIE), and then establish separate tax rates for residents and businesses based on their respective income levels. The local tax would be calculated by multiplying an individual's personal income by the residential tax rate, or a business's reported income by the commercial tax rate. This approach provides an alternative to traditional property tax collection, potentially offering a more dynamic and flexible method of local revenue generation that directly ties tax obligations to income. The bill includes definitions for key terms like "commercial and industrial evaluation" (CIE) and "resident levy" (RL), and requires that the total tax levy from residential and commercial sources must cover the city or town's total required local tax revenue.

Budget and Finance

https://malegislature.gov/Bills/194/H3005