Massachusetts taxpayers who received refunds last year due to excess state tax revenue won't be seeing the same fortune this time around. According to a recent review conducted by State Auditor Diana DiZoglio, net state tax revenues for the fiscal year ending June 30, 2023, fell short of the allowable amount, eliminating the possibility of the excess refunds seen in previous years. Mass.gov reports that the net state tax revenues of $36,924,461,252 were approximately $4.24 billion below the allowable state tax revenues of $41,160,988,265.
This announcement comes after a total of $3 billion was returned to roughly 3.6 million taxpayers last year. The refunds were a result of tax collections exceeding the allowable amount for the fiscal year. Boston Herald notes that in order to be eligible for a refund last year, a resident needed to have filed a 2021 state tax return.
Last summer, there was a revelation about Chapter 62F, especially its requirement for Beacon Hill to give back billions to taxpayers. This caused a bit of chaos in the tax relief talks, leading lawmakers to postpone the topic as the 2021-2022 legislative session ended. Now, over a year later, a small group of six legislators hasn't managed to reach a final agreement on a tax relief bill that's been untouched since late June.
As another Boston Herald article pointed out, both legislative branches have proposed reforms to Chapter 62F. The House has suggested that the state pay out all future rebates in equal amounts, regardless of how much a resident actually paid. The Senate, despite not including the House's language in their version, has proposed requiring the state comptroller to provide monthly reports on tax collections compared to the allowable amount for each fiscal year.
As the end of the formal sessions for this year nears, the timeline for reaching a tax relief deal remains uncertain. "I know the chairs are working hard and they are making progress. So we will continue to work on that," said Senate President Karen Spilka when asked if a deal would emerge before the end of 2023. Taxpayers are left anticipating what future developments may arise, while state leaders continue their efforts to navigate the complex world of tax reform.
