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Patrick Budget Eliminates 44 Tax Deductions

While specific deductions would end, personal exemptions would double under the Patrick budget.

A recent analysis of Gov. Deval Patrick's proposed budget finds that it eliminates 44 tax breaks that benefit a large slice of Massachusetts taxpayers.

Patrick's $34.8 billion FY2014 budget includes not only a 1 percentage point hike in the income tax – from 5.25 percent to 6.25 percent – but the end of such deductions such as the capital gains from the sale of a person's primary home, college tuition, and contributions to a health savings account.

The analysis, by the Massachusetts Taxpayers Foundation, found that the eliminations would raise an additional $1 billion for the commonwealth.

But Patrick's assistant secretary for fiscal policy, Gregory R. Mennis, told The Republican that that amount would be offset by the doubling of personal exemptions, which benefit all taxpayers. 

Another key aspect of Patrick's plan is the lowering of the sales tax from 6.25 percent to 4.5 percent.

When taking this change, along with the rise in personal exemptions, about half of Massachusetts households – in particular those earning less than $60,000 a year – will see their taxes stay the same or drop, by Mennis' calculations.

"It's important to look at the tax package as a whole," Mennis told The Republican. 

The goal of the budget, Patrick has said, is to make the tax code simpler and fairer, with the tax burden shifting from the lower and middle classes to the more affluent.

The bill is being reviewed by the House, which will release its budget proposal in April. 

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walter ferme February 26, 2013 at 02:18 PM
This is great! Keep increasing our income taxes and pretend we are paying less via decreases in sales taxes. Encourage consumption instead of savings ... Increase government exponentially... We had a state budget of $12 billion 20 years ago. Our income has not increased 300% during the last 20 years, why doesn't he try cutting spending? We are still in a recession.
SM_bos February 26, 2013 at 02:46 PM
Bravo to Walter. . . It's pretty crazy if we're tripling our budget in 20 yrs unless overall growth has tripled. And we should be supporting savings. I'll also add that the proposed mixed-bag of increases and decreases is very opaque to most taxpayers. (I suspect this is deliberate, but thats another issue). We need the Patrick Admin- or the press- to provide a few examples. Single mom and 3 kids earning $40k. Couple without kids earning $130k. Couple with kids earning $200k, Single earning $75k, etc.

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