Massachusetts income tax rate decrease takes effect on January 1

In the general election of 2000, Massachusetts voters approved Question 4 with 59 percent of the vote. The initiative enacted a law that would lower the state’s personal income tax from 5.9% in 2000 to 5% by 2003.

In 2002, the Massachusetts General Court passed House No. H.5250, which replaced the schedule adopted by Question 4 with a more gradual decrease tied to revenue milestones. The act decreased the state’s personal income tax rate by 0.05% every fiscal year that revenue benchmarks were met. On January 1, 2020, the rate will decrease to 5%—the target rate of Question 4.

The rate decrease is expected to lower tax revenue by $88 million in fiscal year 2020, which ends June 30, 2020. Massachusetts is one of nine states with a flat income tax rate. In 2019, the average income tax rate among those states was 4.49 percent.

From 2010 through 2018, Massachusetts voters approved 8 citizen initiatives. Of those, two were altered by the state legislature; one was amended and one

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Legislative alteration