North Shore Chamber Collecting Signatures on Petition to Repeal Technology Tax

Petitions are now available locally at the North Shore Chamber of Commerce’s Danvers office to repeal a new and controversial technology tax in Massachusetts.

State lawmakers recently enacted the 6.25 percent tax on computer and software technology services as part of budget deliberations this summer. The response from the business community, which strongly opposed the measure, was to file an appeal for an initiative petition to appear on the ballot at the next state election. The intent is to repeal the tax.

Bay State business leaders and other advocates criticize the new tax, estimated to levy an additional $500 burden on state employers, as anti-competitive and the “death knell” to the innovation economy.

“Thanks to the ingenuity of its people Massachusetts has long been a leader in innovation, which is why we have been proud to call this state home since our founding in 1967,” said Analogic Corp. CEO Jim Green in a recent press release from the Mass. Taxpayers Foundation. The international medical technology company employs 900 workers at its Peabody headquarters.

“This tax will negatively impact our ability to compete and win business and will likely pose an array of challenges to technology companies seeking to invest and grow in Massachusetts,” said Green, who is also a board member of the Massachusetts High Technology Council.

The Peabody Area Chamber of Commerce is also interested to hear feedback from local businesses and residents on the measure and recently posted a blog entry here to generate discussion.

“In the State House in Boston we witnessed a strange phenomenon from the standpoint of a tax being imposed on the technology sector of our economy, which, as you know, is a major growth sector for Massachusetts,” William Tinti, a member of the North Shore Chamber’s task force on the effort, told a crowded room at the Danversport Yacht Club last week during the annual State of the Region breakfast.

“That tax would be the largest tax on technology in all of the sates in this country,” Tinti said.

He noted the Chamber and the Mass. Taxpayers Foundation led the effort to add a ballot question in 2014 to allow taxpayers to speak on the matter. Tinti said Chamber Executive Director Bob Bradford was the first to sign that filing.

The state Attorney General’s office recently approved that appeal, which was filed in August, and according to the MTF, 68,911 signatures from registered voters are needed in order to send the petition before the legislature.

Lawmakers can then repeal, modify or take no action on the petition by next May. Once that deadline passes, another 11,485 signatures need to be collected.

Tinti added that technology companies are certain to pass the added tax burden onto their customers, either in part of whole, and as encouraging note, Gov. Deval Patrick has now indicated he favors repealing the new tax as well.

The Boston Globe reports that now Patrick, Senate President Therese Murray and House Speaker Robert DeLeo all say they will back efforts to repeal the tax.

The office for the North Shore Chamber of Commerce is located at 5 Cherry Hill Dr. in Danvers.