, Gloucester, MA

September 16, 2013

Changes of heart on lousy tech tax brings no assurances

Gloucester Daily Times

---- — It’s hard to tell whether it’s been the push by state Senate Minority Leader Bruce Tarr that’s turned even the State House tide against the ill-conceived and confusing tech tax, approved by lawmakers this summer while scrambling to find revenues to support Gov. Deval Patrick’s state transportation plans.

It could have just as easily been the still-looming threat of a 2104 referendum aimed at repealing the measure. And we’d like to think that the widespead opposition from businesses across Cape Ann, the North Shore and the state has played a role as well.

But when Gov. Patrick last week dropped his support for the much-reviled duty on software design services, telling the State House News Service it was a “serious blot” on the state’s reputation as a hub of innovation, it clearly marked an important step toward common sense. Since it was the governor who proposed the tax in the first place, his change of heart is good news.

Still, saying you don’t like a tax and striking it from the books are two different things. As in many things we’ve witnessed on Beacon Hill, there can be a long gap between words and deeds.

Technology companies, including those across the North Shore, call the 6.25 percent tax so vague and poorly written it could apply to any number of businesses and services. Lawmakers say the measure was meant to raise $161 million; IT executives, however, say the tax rules are so soft and spongy they could end up paying closer to $500 million. Talk about stifling innovation.

Even with these positive changes in sentiment, it is important to keep the pressure on the State House. And in that vein, Tarr and other lawmakers should indeed follow through with legislation that would repeal the tax — in writing, and with the full votes of his legislative colleagues.

Let’s not forget that, while backing off this business-killing tax proposal, the governor is already talking about finding other revenue to make up the difference. That means just one thing: reaching into taxpayers’ pockets in a different way. And that’s what has to stop.

The so-called tech tax has been such a fiasco it’s well worth revisiting the spending plan that it’s supposedly needed to support. And that should be the target of any legislation aimed at repeal.

Keep pressing, Sen. Tarr. This is a taxpayers’ fight that seems far from over.