What the New Wealth Tax in Massachusetts Is Paying For

GOVERNING,, Jared Brey, January 9, 2024 

Massachusetts voters approved an additional tax on incomes of more than a million dollars. At least a billion extra dollars will support transportation and education projects this year.

In Brief:

  • New revenue from a 4 percent surtax on high-income earners is helping to fund education and transportation projects in Massachusetts.
  • Legislators allocated $1 billion in related spending for FY 2024, but the Department of Revenue expects the tax will bring in substantially more than that.
  • Every municipality in Massachusetts is getting additional funding for road maintenance. All the state’s transit systems have received additional funds as well.

Becket, Mass., is a small community in the Berkshires with a population of about 1,700 people. Kathe Warden, the town administrator, knows off the top of her head that it contains about 56 miles of roadway. About half the roads are paved and half are gravel. Becket doesn’t have public water or sewer — “a blessing and a hindrance,” Warden says — so maintaining roadways and culverts is one of the biggest tasks of the town government.

In a typical year, Becket receives around $235,000 from the state government for infrastructure maintenance. But this year, Becket, along with every other municipality in Massachusetts, is getting a boost — an additional $152,417, which represents a 65 percent increase in the town’s annual road maintenance budget.

The largesse comes thanks to a new tax on high-income earners, which Massachusetts voters approved in 2022. “It helps tremendously,” Warden says.