There is a sign of sanity in Massachusetts this day. Or, at least, proof that the learned lawmakers are not utterly deaf.
Back in 2002, the state was in a bit of a fiscal crisis Lawmakers raised money in a host of ways, including hiking the state’s capital gains tax midway through the year. The state courts stepped in, however, and said that the tax could not be changed midway through the year. It either had to take effect January 1, 2002, or January 1, 2003. The Republicans pushed for 2003; the Democrats, 2002. To many people’s sorrow and no great surprise, the Democrats eventually won.
And thus was born the wonderful retroactive tax hike, where people who made capital gains in the first four months of the year found themselves being told “yeah, we know you already paid, but we want more.”
The fight continued, off and on, until a few weeks ago when the tax bills went out. And those getting the bills found that the instant they received them, not only were they on the hook for the new tax rate, the state had factored in interest as well — they were being charged for about two years’ interest before the bills were even sent out.
They complained — loudly — but the state shrugged it off. Yeah, they were being hit for interest, but the state had already cut them a break in not adding in a penalty for late payment as well. They oughta just count their blessings, send in their money, and shut their traps.
They didn’t do any of those. They started yelling — loudly.
And in what might be considered a Massachusetts Miracle, they just might be winning.
The public hue and cry — led by talk radio, to give credit where it is due — was incredible. People howled about being taxed after the fact, citing the Constitutional principle of “no ex post facto laws” (a principle that has been held to no apply to taxes — thank you, President Clinton).
Right now, it just looks like that retroactive tax is dead. But we’re talking about Massachusetts lawmakers here. Just because they say that it’s going away, that doesn’t mean squat. I hope the people of Massachusetts watch them like hawks until it’s dead, buried, and fresh grass is growing on its grave — and maybe not even then.