Massachusetts Meets Key Economic Benchmarks; Will Cut State Income Tax

Announcement Demonstrates Effect of Strong Fiscal Management and Prudent Investments in Achieving Economic Growth

State Representative Cory Atkins joined her colleagues in the Massachusetts House of Representatives in recognizing Massachusetts’ thoughtful fiscal management, responsible budgeting, and prudent investments as the Commonwealth announces an automatic reduction of the state income tax for the second time in three years.  As of January 1, 2014 the rate will decrease from 5.25 percent to 5.2 percent.

To achieve the automatic rollback the state must reach various benchmarks including:

·         Inflation-adjusted growth for baseline revenues in fiscal year 2013 must exceed those from fiscal year 2012 by 2.5 percent.

·         The consecutive three month period between August and November 2013  must have a positive inflation-adjusted baseline revenue growth compared to the same three month period in 2012.

“Thanks to our sound fiscal management and commitment to passing responsible budgets on time, Massachusetts has achieved stability and grown our economy,” said Atkins.  “I’m proud that we have been able to protect people through our efforts, and I believe this rollback is an encouraging step as we rebuild our economy.”

Earlier this month, the Department of Revenue reported that tax collections through November were $359 million above the fiscal year 2014 (FY14) benchmark.  Tax collections are up 9.7 percent over the first five months of FY14.

While savings assessments are based on individual earnings and therefore cannot be decisively forecasted, it is estimated that residents will save about $25 to $35 per year.