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High stakes, low engagement

Posted by Chad O'Connor  September 23, 2013 11:00 AM

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Why Massachusetts’ Technology Sector Needs to Stay in the Political Conversation After the Tech Tax Repeal

When technology leaders across the Commonwealth received notice of a new 6.25 percent software sales tax that had just made its way through the state legislature, the notoriously apolitical innovation economy went into a frenzy. Blindsided by the news of a new burdensome taxation that would severely impact their ability to succeed, technology companies of all sizes, specialties, and operating systems struggled to interpret a series of broad and overarching guidelines to figure out how they would be translated into regulations and delved into the financial specifics with CFOs to see if it would be possible to incorporate the new costs into their pricing schemes and contracts.

An industry that was once considered apolitical by choice was suddenly thrust into the center of a regulatory battle that could shape the future of Massachusetts’ innovation economy.

In conversations I had with industry leaders in the days following the unveiling of the tech tax, the disconnect between the innovation community and political sphere became ever more apparent. CEOs that I would otherwise characterize as some of the smartest and most forward-thinking entrepreneurs in Massachusetts asked questions varying from how a bill becomes law to who exactly determines how the new tax is applied.

As a former Kendall Square venture capitalist turned City Councillor, I understand this political apathy. When you’re working to develop the next cutting-edge technology in an industry where all-nighters and weekend meetings are the norm, political engagement isn’t exactly on the top of your mind. You assume that your elected officials are aware of the economic fortune you bring to your community and are working with your best interests at heart. This summer, the tech industry learned the hard way not to take this for granted.

In what many would argue to be one of the most organized and cohesive lobbying efforts that Beacon Hill has seen in the last few years – now nicknamed the ‘Beacon Hill Blitz’ – the tech industry made their voices heard via social media, action alerts, in-person visits and media coverage. It worked. Even before the state collected a cent from the new tax, Governor Patrick and leaders from the State House have called for a repeal – a feat that is virtually unheard of.

Going forward, the technology community has the potential to play a huge role in ensuring that our legislators on Beacon Hill keep Massachusetts as a hub of innovation – if they choose to do so. Being proactive is the only way that Kendall Square – the most innovative square mile in the world – can continue to hold its own against Silicon Valley. Now that we’ve demonstrated the impact of our political voice, it’s crucial to stay an active part of the conversation.

Leland Cheung is a Cambridge City Councillor. Connect with him on Twitter @LelandCheung.

This blog is not written or edited by or the Boston Globe.
The author is solely responsible for the content.

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