The bill was
filed on Wednesday, August 2, and, the day after, it was sent by House leaders
to the Joint (House-Senate) Committee on Revenue, whereupon Rep. Jay Kaufman of
Lexington, the House co-chair of the committee, said it would be a “colossal
mistake” to have a sales tax holiday because of how hard it is going
to be to balance the state budget this fiscal year.
According to
Department of Revenue estimates, the state would forego around $25 million if
no taxes were collected on the sale of goods during the third weekend of
this month. (Only purchases of $2,500 or
less would be covered by the proposed law.)
In 11 of the
past 13 years, there has been a sales tax holiday in August, each authorized
year to year by a special act of the legislature. Bricks-and-mortar retailers, pummeled by
online competitors, have practically been begging the Commonwealth to turn that
into a 12-of-14 record. With Amazon
getting bigger by the week, how can a Republican governor not feel their pain?
There were already bills before legislative committees to establish permanent two-day sales tax holidays when the governor came up with his bill for a 2017-only holiday.
House
Speaker Robert DeLeo was quoted last Wednesday by the State House News Service
as saying “it makes little sense” for the governor to have filed his own bill
at this juncture. That was a typically
careful comment from the leader of the lower branch. DeLeo did not say he was opposed to the bill. He did not say it made no sense. He only
implied that, at first blush, he was puzzled by the governor’s strategy in
putting it forward now.
Puzzlements
are like rumors: made to be dispelled…and there’s no one like the nation’s most
popular governor at this time (and member of the Bob DeLeo fan club) to do the
dispelling.
The
governor’s bill looks now to be dead on arrival in the Revenue committee. This is a money bill and only the House can
initiate a money bill; therefore, Chairman Kaufman’s opposition would seem to
be dispositive, as the lawyers like to say.
I’m focusing
on how Senate leaders have not yet concurred in the referral of the bill to
Revenue. Senate President Stan Rosenberg and Speaker DeLeo, working quietly together, could now decide to pull the bill
from Revenue and send it instead to the Joint Committee on Economic Development
and Emerging Technologies, whose House co-chair, Joe Wagner of Chicopee, is
known to favor sales tax holidays.
Wagner could
then become the point man in the House for moving the bill, sparing Kaufman
from having to disavow his colossal mistake comment as he retreats to the pool
of unanimous support for the bill willed suddenly into existence by the
Speaker.
The
legislature is in recess until September and is holding only informal sessions
once or twice a week in August. Under
legislative rules, only “non-controversial” items may be taken up during
informal sessions. If even one member
present during an “informal” objects to voting on a bill, it must be immediately
tabled, killing the possibility of any action on it that day.
I think the
governor had the tacit support of Speaker DeLeo and President Rosenberg when he
filed the sales tax holiday bill last Wednesday or was exceedingly confident of
winning their support once it was filed.
Baker of course knows that the leaders of both branches can make things
happen smoothly and quickly if they want to, and that each leader could secure
the acquiescence of any reluctant member of his Democratic caucus on an issue
as popular as making taxes disappear for a spell, no matter how
short. (No Republican would think of
voting against a deal like this.)
For
two-and-a-half years, Baker, Rosenberg and DeLeo have formed a team as cohesive
and as mutually respectful as any could be with players from different parties with different agendas.
We should
keep in mind that, just about now, Rosenberg and DeLeo owe Baker one. Before recessing, the legislature rejected a
major initiative dear to the governor’s heart, a package of Medicaid reforms
strongly supported by business groups.
To avoid a fight with the legislature, the governor reluctantly signed
into law the measure wherein the Medicaid reforms were rejected and accepted a
kind of fuzzy offer from the legislature to consider the reforms slowly and
deliberately over the next few months.
Business groups, which had been calling for the governor to veto the
measure, did not hesitate to criticize him publicly for not vetoing it. The National Federation of Independent
Businesses, for instance, said it was “incredibly disappointed” in Baker.
Baker can begin
to mend fences with his natural constituencies in private enterprise by getting
a sales tax holiday done in a hurry. The
Democrats who run the legislature can help him do that because they like and
respect Baker and value the relationship they have with him. At the same time, they’ll help their party by
giving voters a break at the cash registers on August 19-20. This colossal mistake will become no big deal
in no time.
Guess what. Twenty-five million in lost tax revenue in an
overall state budget of nearly $40 billion isn’t
a big deal.
Baker’s new Secretary of Technology Service and Security, Mark Nunnelly, for example, could save at least $25 million by eliminating the state’s 1980s-style, grab bag approach to procuring computer and telecommunications systems and replacing it with the mindset and methods in evidence at scores of successful Massachusetts businesses, universities and medical centers.
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