In a recent letter, state Senator Pat Jehlen cited three sources in arguing that high taxes are not the reason many Massachusetts residents are leaving the state (“Ongoing debate over Mass. tax relief,” May 30). I offer three data points to counter her argument.
Jehlen cites a New York Times article indicating that Boston is unique among large metropolitan areas because it experienced net in-migration of college graduates. That same article noted that “Boston’s pull with college graduates has weakened.” For a region heavily reliant on college graduates for its talent pool, this is a troubling trend.
Jehlen cites a Massachusetts Budget and Policy Center report showing that Massachusetts has a lower percentage of high-income people leaving than 40 other states. That may be true, but it is not because taxpayers do not care about state taxes, as the center is fond of saying. Massachusetts has a higher concentration of people with incomes over $200,000, so in absolute terms it is losing high-income earners at an accelerated pace.
The senator references a Boston Business Journal article that indicates that the number of millionaires in Boston has risen 50 percent in the last decade. This is a good news story, but it may be a fleeting one. We know that the economy is cyclical and that inflation, a volatile stock market, and a recalibration of the tech industry could erode some of that wealth. In fact, April tax collection data indicate that capital gains tax revenue is down considerably year over year.
Jehlen ends by suggesting that our housing crisis can be attributed to the state’s gain in population. Our housing crisis is multifaceted. That is why, despite policy makers’ focus on more affordable housing for decades, they have had limited success. The reason tax reform is necessary is that it can be implemented quickly and stop the outflow until the state can address some of the more intractable costs of living.
The writer is a senior fellow with the Pioneer Institute and former president of the Massachusetts Taxpayers Foundation.