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Misinformation on tax equality

WHO HAS the power on Beacon Hill? The people who are losing libraries, teachers, and sports programs to deep municipal budget cuts? Or, the business community, which is ducking its responsibility to help close the fiscal gap?

Here's what the current budget battle seems to be coming down to:

Governor Deval Patrick v. House Speaker Salvatore F. DiMasi.

The average citizen stressed by sky-high property taxes v. the special interests lobbying to protect themselves from paying their fair share.

Patrick may be breakfasting with chief executives and accepting political donations from them. But at least he's also telling them what they don't want to hear: Massachusetts tax laws need to be changed to ensure tax fairness.

The governor wants to end a 92-year-old law that exempts Verizon from paying the same property tax paid by everyone else. Making the change could add up to another $75 million in revenue.

Patrick wants to give cities and towns options to raise revenues by increasing meals and lodging taxes. Even a 1 percent local option meals tax could raise as much as $120 million for Massachusetts cities and towns.

He also wants to close corporate tax loopholes. One such proposal endorsed recently by a special commission on corporate taxation would stop businesses from skirting an estimated $100 million in annual taxes.

This isn't major property tax relief, but it's not a business killer, either.

Yet, DiMasi has been falling for the business community's tired old line: If you make business pay the taxes it should be paying, Massachusetts will lose jobs to other states.

In the 1990s, that argument helped such companies as Raytheon and Fidelity win tax breaks worth hundreds of millions. Guess what happened next? Those companies shifted jobs out of Massachusetts anyway. That's because labor costs, not tax bills, are more important when it comes to corporate relocation decisions.

Threatening to leave the state is "a specter they always invoke . . . anytime there is any discussion of taxes," said Arnold Hiatt, the former chief executive of the Stride Rite Corp. "It is never true historically. . . . I don't know anybody who decided to move over tax rates. But I do know this mantra is always recited."

If you repeat something over and over, it becomes truth -- or, it becomes the foundation of a campaign like the one being waged by the Greater Boston Chamber of Commerce.

In print and radio ads, the chamber is essentially arguing that tax equity is a threat to economic development and job growth. So far, the chamber has an advocate in DiMasi, who is championing this intellectually fraudulent argument in the House.

Why does it work? Legislators, said Hiatt, "are very vulnerable to misinformation." The former chief executive also expressed disappointment in the willingness of current business leaders to misinform. "There were some fairly good citizens in the corporate community. . . . They saw things in a broader perspective. There's a kind of parochialism in today's current 'leadership,' " he said.

Instead of misinformation, how about some information?

For the business community, generally, and especially for Verizon, this is not Taxachusetts.

Businesses in 41 other states pay a greater percentage of their states' total state and local taxes than businesses pay in Massachusetts.

As for Verizon, according to information supplied by the Patrick administration, the company's state and local tax bill in Massachusetts equaled 1.19 percent of its total revenue in 2006; its national tax average was 4.43 percent. And, even as Massachusetts sends Verizon one of the lowest tax bills it receives from anywhere else in the country, Massachusetts ratepayers receive one of the highest Verizon bills in the country.

Unless you're the Greater Boston Chamber of Commerce, it's hard to get emotional about tax exemptions and loopholes. But maybe it is time to get emotional about the bigger picture here: what is happening in cities and towns across Massachusetts.

Do you want to see more towns like Saugus shuttering libraries? Do you want to see more parents taking out loans to fund athletic teams and school choirs, as contemplated by parents in Northbridge? Do you want a Massachusetts with a greater and greater divide between communities with parents who can afford to take out those loans and those who cannot?

The state budget shouldn't come down to a power struggle: Patrick v. DiMasi, us v. them, the average citizen v. the corporate citizen.

It should be about a Commonwealth collectively and honestly trying to figure out the best way to remain one.

Joan Vennochi's e-mail address is