Policy Group: Massachusetts Millionaire's Tax Could Lead to Migration

The Pioneer Institute released a paper on S. 5, a proposed Massachusetts constitutional amendment that would create a surcharge tax on income over $1 million beginning in tax year 2023 pending voter approval, analyzing several sources of academic research on the economic consequences of states imposing wealth taxes; the paper concludes that while jurisdictions may be tempted to increases taxes following the COVID-19 pandemic, studies show that wealthy taxpayers may respond to such policies with avoidance behaviors, including moving to other states.

It is estimated that the proposed surtax could decrease the amount of taxable income in Massachusetts between $606 million and $2.02 billion.