The following is cross-posted at www.fiscalaccountability.org:
Happy Cost of Government Day, Massachusetts!? If you think “wasn’t Cost of Government Day last week?” you’re right, but that was the national date. For Massachusetts taxpayers, that day has finally arrived today, on August 17 – five days later than the national average. (Click here for the full report)
As a reminder, Cost of Government Day is the day of the calendar year on which the average American worker has earned enough gross income to pay off his or her share of the spending and regulatory burdens imposed by government.
However, the late Cost of Government Day does not really come as a surprise for a state that is notorious for its tax-and-spend policies. In fact, it is no coincidence that Massachusetts has the nickname “Taxachusetts.
Massachusetts has repeatedly raised taxes on its residents – by almost $10 billion, or $ 1,533.42 per capita, between FY 2003 and FY 2009.
While the state legislature refrained from tax hikes for FY 2009, things are different for FY 2010. In June this year, Gov. Deval Patrick signed a $27 billion state budget that contains about $1 billion in new taxes.
Among them are:
- a sales tax increase from 5% to 6.25%;
- the removal of the sales tax exemption on off-premise sales of spirits, beer and wine;
- a 5% tax on satellite TV service;
- an increase in the meals tax to 6.25%;
- a hotel tax hike.
So while tough fiscal times could be seen as an opportunity to tighten the fiscal belt by cutting spending so that Massachusetts would finally be seeing Cost of Government Day fall before the national date, these tax increases are only going to perpetuate the problem.
Photo credit: Taylor Tai