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Globe Editorial

Fair taxes for tough times

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April 7, 2008

A STATE BUDGET is more than just numbers. It is a political equation setting out shared priorities. The House today is expected to take up several proposals for new revenues that are crucial to maintaining the state’s reputation as progressive and fiscally responsible. We hope House members will adopt them as part of a balanced plan to steer Massachusetts through the expected recession.

The revenue plans are fairly modest: a $1 increase in the cigarette tax to help Massachusetts implement its landmark universal healthcare law; two technical changes to keep certain corporations from avoiding their fair share of taxes; and some smaller tax enforcement measures. All told, the changes would net an additional $522 million to help balance a $28 billion budget.

House Speaker Salvatore DiMasi and Governor Patrick have proposed off-setting some of the sting of the increases with reductions in the corporate tax rate. DiMasi’s proposal is a deeper, faster cut for business than Patrick’s; leaders should take care not to squander too much revenue amid stormy economic forecasts. Unlike the federal government, the state cannot run deficits in lean times, and must avoid disrupting vital services.

Later this week the House is expected to take up proposals to allow local communities to replace costly police details at construction sites with flagmen. This should provide small but significant relief to cities and towns burdened by rising costs and tapped-out property taxpayers.

We would add to the package a measured proposal to allow local communities the option of increasing meals taxes. It won’t help every community, but it will give many cities and larger towns some autonomy over their own fates. The increases being contemplated are vanishingly small: a 1 percent hike in the meals tax would mean an extra 50 cents on a $50 restaurant bill.

In crafting a fair, forward-looking budget, where to get the money is as important as how to spend it.

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