The Supreme Court sided with South Dakota in its legal battle with a Boston based online retailer. The ruling last week basically paved the way for a widespread taxation of online sales.
But will widespread taxation actually happen, and is there something that needs to be done on Beacon Hill in order for the state to be able to collect that tax?
Matt Murphy, State House News Service: What's interesting in this case is that the policy that South Dakota was pursuing and actually won the case on, is something Massachusetts is already doing. They, too, have been challenged in the court in Virginia by a major electronics retailer, called Crutchfield Corporation, and that case is still pending. But I would expect that case may disappear soon as a result of this Supreme Court ruling.
What Massachusetts did with the Baker Administration did last year was put in place a policy that required online retailers that do over $500,000 in business from Massachusetts customers to collect and remit that sales tax back to the state. They've been doing this for the past almost year now. And that is not going to change under this policy, which is why the Department of Revenue is suggesting that the Wayfair decision, -- while it certainly upholds the practice that Massachusetts is pursuing -- it's not going to result in a big windfall. [That's] despite some Democrats (particularly on Beacon Hill) initially cheering the Wayfair ruling because they thought it would at least partially replace the money they were hoping to get from the millionaires tax, which got struck down by the state courts earlier in the week.
Carrie Healy, New England Public Radio: So this isn’t actually a tricky issue for legislators. They aren’t going to be associated with a tax and spend scenario then.
They’re not, but they could be. I think it bears watching what happens now. The administration says they have no plans to revisit their policy and they’ve set this threshold on online retailers. But there are a lot of people throwing around numbers like $300 million when what the administration is actually collecting in these online sales taxes is only about $30 million a year. And if the legislature wants to look at this as a potential revenue source, they could look at forcing the administration to change that threshold and maybe capture more online retailers that aren’t getting caught up right now in the [Massachusetts Department of Revenue] rules.
Last week, the so-called "grand bargain" was reached on Beacon Hill. Do you get the sense that it brought us to more clarity this week about which ballot questions may – or may not- appear on the ballot in November?
It did bring more clarity, but not total clarity. As I previously mentioned, this all kind of started with the Supreme Judicial Court ruling last Monday knocking the millionaires tax off the ballot, which kind of paved the way for this so-called "grand bargain" to come together. We know now that the union group, the RaiseUp Massachusetts coalition, has voted to drop their paid family and medical leave question as a result of this, because the legislature has included that in a bill that they passed last week.
What they haven’t decided yet is whether to drop their pursuit of the minimum wage increase, even though the legislature voted for a new $15 minimum wage and some other provisions. The RaiseUp coalition hopes to decide early this week, after taking a few days and over the weekend to think about it, whether or not they’re going to go to the ballot anyways. Their ballot question is slightly different from the "grand bargain" legislation that passed and is currently sitting on the Governor’s desk.
It’s officially down to the wire now for the Massachusetts budget. The last week of June is here and the state’s fiscal year begins July 1. So is it budgets that are top of mind this week?
Budget is top of mind this week. The conference committee has been meeting. I think that there will probably be a big push this week to try and get this out, and done and delivered to the governor.
The legislature likes to get these things done before the start of the fiscal year on July 1, and then give it to the governor who will then have ten days to review it, and typically takes those full ten days. [That's] why last week he filed a budget extension that would essentially give the state about $5 billion to keep paying its bills and stay open and avoid a government shutdown in case the new budget is not in place for July 1. Unlike in Congress, these are fairly standard and accepted here on Beacon Hill. And I would expect the legislature to also push that through this week as they wait for the conference committee to produce their final report.
