“There’s a lot of uncertainty around millionaire’s tax revenue at this stage of its implementation, which makes it risky to commit all dollars,” Horowitz said.
Horowitz also expects the policy’s implementation will lead to roughly half a billion dollars in lost income tax revenue “as taxpayers who leave the state or engage in tax avoidance will end up skirting both the millionaires tax and the state income tax.
Horowitz proposed including $750 million to $1 billion of the millionaire tax revenue in the fiscal 2024 budget and setting any additional money aside in a “savings and stabilization plan.”
Horowitz suggested that any extra revenue garnered from the surtax should be funneled into a separate savings account — similar to how the state handle revenues from capital gains.
Horowitz added, “What is more, our modeling suggests that even ignoring the impact of inflation we are likely to end this fiscal year with a revenue shortfall of roughly $1 billion. The decisive factor will be April collections.
Researchers at cSPA say the surtax will likely only apply to about 0.6% of Massachusetts households in any given year. The center estimated that in 2023, at least 26,000 — less than 1% of the state’s households — will earn greater than $1 million.
"There aren't great big initiatives that he drove," Horowitz said. "And the ones where he really seemed to try to stamp with his imprimatur didn't thrive."