Patrick’s Proposed $34.8 Billion Budget Includes New Tax On Candy, Soda, Cigarettes
BOSTON (AP) — Gov. Deval Patrick has unveiled a proposed $34.8 billion budget for the new fiscal year — a plan he said is focused on nurturing the state’s economy and creating more jobs.
The budget would increase state spending by 6.9 percent over the current fiscal year. That’s an increase that Patrick said is consistent with pre-recession budgets.
The plan unveiled Wednesday includes an additional $1.2 billion from tax changes that Patrick proposed last week including a hike in the income tax rate from 5.25 percent to 6.25 percent and a cut in the sales tax from 6.25 percent to 4.5 percent.
Patrick is also recommending increasing the cigarette excise tax by an additional dollar, bringing the total tax to $3.51 per pack.
Patrick said the net tax revenue increase would be dedicated to paying for transportation and education initiatives, including increasing local education funding by $226 million over the current year’s budget and boosting how much each school district receives per child by $25.
That would set total local aid to cities and towns at nearly $5.6 billion — or about 14.6 percent of all state spending, he said.
Patrick’s budget includes some earlier proposals he’s made including requiring the sales tax for candy and soda, which are currently exempt like other food items.
He again proposed capping the state’s film tax credit at $40 million a year. Supporters of the film tax credit say that capping it would only end up discouraging movies from being made in Massachusetts, costing the state jobs and tax revenue.
Patrick defended his decision to press for additional tax revenues during a press conference unveiling the budget proposal. He said the money is key to ensuring the state’s economic future.
“I do not submit this proposal lightly,” Patrick said.
Patrick said any new tax revenue needs to be enough to pay the state’s bills and should be targeted at specific goals. He also said any changes need to be competitive with tax policies in other states and fair for taxpayers in Massachusetts.
Patrick last week unveiled an education plan that he said would cost an additional $550 million in the 2014 fiscal year to pay for universal access to early education from birth through age 5, fully fund K-12 education and allow for extended school days in high-need schools.
The plan would also make college more affordable and let community colleges expand efforts to provide students with critical skills training.
Patrick’s budget is the first step in a lengthy budget-writing process.
The Massachusetts House and Senate will review his spending plan and propose their own budgets before coming up with a final compromise version to be sent to Patrick for his signature.
The new fiscal year begins July 1.
Associated Press Writer Steve LeBlanc contributed to this report.
Copyright 2013 The Associated Press.