Currently, the Massachusetts tax system is upside down: the highest income households pay a significantly smaller share of their income toward state and local taxes than the rest of us do. A “millionaire tax” would help turn our tax system right-side up.
The “Fair Share Amendment” would create a millionaire tax in Massachusetts. It would apply an additional 4 percent tax to the portion of a household’s income above $1 million. With such a tax in place, the top 1% of households (whose average income is $2.4 million a year) would pay a share of their income toward state and local taxes that is closer to the share of household income that the rest of us pay (see chart, below).
![](https://massbudget.org/wp-content/uploads/2022/04/FSA-Makes-Mass.-Tax-System-Fairer.png)
As the chart above shows, the top 1% of households pay an average of 6.8 percent of their income toward state and local taxes. With the Fair Share Amendment in place, the top 1% instead would pay an average of 8.7 percent. This is closer to the average 8.9 percent share of income paid by the bottom 99% of households.
It is important to underscore that a millionaire tax would affect only the very few taxpayers in Massachusetts with taxable incomes above $1 million a year – fewer than 7 in every thousand households. Notably, these are the same households that benefit from billions of dollars each year in state and federal tax breaks, and which, as a group, have prospered during the pandemic.
Working together, the people of Massachusetts can create a better Commonwealth. We can modernize our schools and state colleges. We can repair and upgrade our crumbling roads, bridges, and public transit systems. We can provide affordable, high-quality childcare and put vocational training and higher education within reach of those who want it. To achieve this vision, we will need to collect substantial, additional tax revenue – and do that in a way that’s fair. A millionaire tax is one example of a policy that can make our tax system fairer and help deliver broadly shared economic prosperity and racial justice.