The Greater Boston Chamber announces the unveiling of a new economic recovery platform aimed at strengthening Massachusetts’ competitiveness. “Renew the Massachusetts Economy,” or “Renew Mass,” is a series of tax proposals designed to strenghten our region's competitiveness and stimulate job creation. The Chamber will promote this platform to the
state’s candidates for elected office, and looks forward to discussing these and other proposals that will lower business costs and make Massachusetts more competitive.
The platform consists of four tax proposals, each of which will make Massachusetts a more attractive place to do business. The proposals are:
1) A “3-in-3” Investment Incentive—A new 3% state capital gains tax rate on investments in Massachusetts-based startups held for at least three years, to encourage startups and patient capital. This proposal would not cost the state any lost revenue for the first two years, and its cost in each of the following three years would average $9 million. It would change Massachusetts’ tax rate on such investments from the 17th-highest in the country to the 3rd-lowest. Click here to download the information sheet.
UPDATE: On August 5, Governor Patrick signed the 3-in-3 Investment Incentive into law as part of the economic development bill. Click here to read more about this momentous development. Thank you to all of our members who supported this critical initiative.
2) An ITC Expansion Incentive—An increase in the state’s investment tax credit from the current 3% to 5%, to spur capital spending and expansion of company facilities. This change would lower short-term state tax collections by $25.5 million per year, increase annual capital investment by $146 million, and spur the creation of 2,800 jobs, which would generate new long-term state tax revenues. Click here to download the information sheet.
3) An NOL Innovation Incentive—Reform of the state’s net operating loss carry-forward rules, bringing them into parity with those utilized by most states and the federal government, to make Massachusetts more competitive for innovation-based industries. This proposal would not cost the state any lost revenue for the first two years, and its cost in the following three years will average $18 million. It would move Massachusetts from a tie for the worst NOL policy in the country, to having one that is in the upper half of all states. Click here to download the information sheet.
UPDATE: On August 5, Governor Patrick signed the NOL Innovation Incentive into law as part of the economic development bill. Click here to read more about this momentous development. Thank you to all of our members who supported this critical initiative.
4) An Elective Single Sales Hiring Incentive—Give all Massachusetts companies the option of electing single sales factor tax apportionment, to encourage in-state hiring, investment, and expansion. This proposal would be phased in over a five-year period, resulting in $20 million less in short-term state revenue collections in the first year and $100 million less in the fifth year. This proposal would spur the creation of 32,000 to 37,000 jobs when it is fully implemented, and those jobs would generate significant new payroll, sales and property tax revenues. Click here to download the information sheet.
This platform will significantly improve Massachusetts’ competitive position and will stimulate the creation of 35,000 to 40,000 jobs. As outlined above, its short-term impact on state revenues is modest; two of the proposals will not reduce state revenues at all in the first two years. Its long-term impact on economic growth and state revenues will be strongly positive.
The Chamber is reaching out to state government leaders, the major gubernatorial candidates, our partner business organizations and media leaders to brief them on the platform, solicit their comments, and invite their support.
