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Slow rollout of tax hikes raises questions

Governor Deval Patrick’s tax proposals were rolled out incrementally, puzzling some observers.

AP Photo/Michael Dwyer

Governor Deval Patrick’s tax proposals were rolled out incrementally, puzzling some observers.

For two weeks, it seemed like Governor Deval Patrick’s proposed tax hikes might never stop coming.

First, he announced a plan to raise the income tax in his annual State of the Commonwealth speech. The next day, he put a gradual gas tax hike on the table, along with higher transit fares and tolls, and detailed dozens of tax deductions he wants to revoke. News of taxes on candy and soda, with added taxes on cigarettes, were only revealed to be part of his $1.9 billion tax package a week after he introduced it.

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The massive tax proposals leaked out in a steady drip that puzzled some observers, who saw him trying to soften the blow of a complex plan, but also prolonging a controversial discussion.

“I don’t think the rollout has helped the governor at all. He’s kept tax increases on the front page for days on end,” said Jim Stergios, executive director of the Pioneer Institute, a conservative think tank.

Others saw political value in giving taxpayers a bite to digest at a time, lest they choke on the news.

“I think strategically it was a small advantage to release the details incrementally. It did blunt a jaw-dropping reaction to the scope of the tax increases that is now slowly catching up with the public,” said Jeff Berry, a political science professor at Tufts University.

Even in its incremental rollout, though, Berry said he thinks the tax plan is overly ambitious and unlikely to be embraced by the Legislature.

‘The reaction has been as good as we could have hoped in terms of having a real serious conversation.’

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“I think he’ll be lucky to get half of what he wants,” said Berry. “It’s clearly a negotiating ploy.”

The Patrick administration has already hinted at compromise, noting that the proposal is more of an initial pitch than a final offer.

“The governor knew he was taking on a tough conversation when he put the proposal out there. What he was hoping to do was to start a conversation about what do people want to invest in and what’s the best way to pay for it,” said Patrick’s chief of staff, Brendan Ryan.

He suggested that the governor is more attached to the principle of increasing investment and opportunity and less wedded to the specifics of each tax increase.

“The administration doesn’t have a corner on all the right ideas,” Ryan added. “The reaction has been as good as we could have hoped in terms of having a real serious conversation.”

Alex Zaroulis, a spokeswoman for the Executive Office for Administration and Finance, said the administration did not want to overwhelm voters with details in the initial announcement.

“We wanted to be able to have a longer discussion, get people understanding what we’re talking about, get feedback from people,” she said.

Some of Patrick’s supporters in his liberal base assert that by focusing on what he wants to do with the money — improve transportation and education programs — Patrick helped lay the groundwork to forge support for the tax increases.

“I was actually just remarking on this, that I think they have done a really excellent job of rolling this out,” said Sonia Chang-Diaz, a Democratic state senator from Boston. “I hear him talking a lot about the why of this.”

Chang-Diaz expressed support for the package, even as she acknowledged that she hasn’t fully digested how it could affect her constituents.

“I’m just glad we’re having this conversation,” she said. “A conversation that starts with telling some truths, albeit unpopular ones, about what it takes to make a successful state.”

The tax plan the governor proposed is complicated not only because it asks residents to support public investment with nearly $2 billion more in new taxes, but also because it would make the tax code more progressive, shifting the burden away from low-income taxpayers by lowering the sales tax and raising personal exemption rate.

The way the governor unveiled his tax proposals put heavy emphasis on the positives of progressive tax structure and public investment, but skimped on the details of how it would impact individual taxpayers and corporations, said Michael Widmer, president of the business-funded watchdog group the Massachusetts Taxpayers Foundation.

For instance, he noted, the governor aims to revoke 44 tax deductions that currently give taxpayers breaks on everything from child care to business lunches.

As the fine print came into focus, it became clear that the tax exemptions affect not just obscure tax filers, but “the great majority of individuals in the state,” Widmer said.

For instance, Patrick proposed eliminating a state deduction of up to $2,000 that Massachusetts taxpayers are currently allowed to deduct for their contributions to the Social Security system.

That change would come on top of increases to the federal payroll tax that took effect earlier this month.

Widmer suggested that such specifics are being deliberately downplayed by the governor, who is focusing on the tax plan’s higher goals.

“When you have something and you’re taking it away from 3 million tax filers,” he said, “then that’s not going to be popular.”

Stephanie Ebbert can be reached at ebbert@globe.com. Follow her on Twitter @stephanieebbert.
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