Bad Bill of the Week: Sen. Brownsberger’s Nonprofit Tax

Starting this week, Massachusetts for Jobs will be featuring one bill from the state legislature as the Bad Bill of the Week. This will highlight anti-jobs legislation, wasteful spending, and needless taxes.

Our inaugural Bad Bill of the Week is SB #1451, introduced by Sen. Will Brownsberger (D – Belmont), which would allow towns to tax nonprofits that are currently exempt from taxation. If this bill passes, hospitals, universities, churches, homeless shelters, soup kitchens, and other nonprofits could all be subject to taxes they are currently exempt from paying.

The bill would authorize towns to tax nonprofit’s property at 25% of the standard property tax rate. If the bill is enacted, plenty of towns would immediately begin taxing their non-profits. This would hurt not only the people in the town, who benefit from the nonprofit, but all the people outside the town who travel to use the nonprofit.

For example, if Worcester started taxing UMass Medical, the hospital would have less money to put toward research, treating low-income patients, and other functions that benefit people not only in Worcester, but throughout Massachusetts. Likewise, if Easton began taxing Stonehill College, the college would have to divert funds from scholarships, innovative new professors, and constructing new classrooms in order to pay their tax bill. The same thing would happen if Westwood started taxing Xaverian Brothers.

The results of the nonprofit tax would be similarly bad for homeless shelters. A recent report by the Springfield Republican showed how Friends of the Homeless, a Springfield shelter, was already struggling to keep their doors open to people in need. If Sen. Brownsberger has his way, the new tax could make it impossible for them to stay open.

That wouldn’t help anyone in Massachusetts, but it would be likely to happen if Sen. Brownsberger has his way. Massachusetts prides itself on leading the nation, but we shouldn’t become a national leader in taxing soup kitchens, homeless shelters, educational institutions, churches, and other nonprofits.

The nonprofit sector is an essential part of Massachusetts’ economy. According to a 2012 report by The Boston Foundation, the state’s 34,366 nonprofits employed one-sixth of Massachusetts’ workforce and generated $234 billion in revenue. The last thing we want to do is tax institutions that provide economic development while also giving back to their communities.

Mass Citizens for Jobs hopes the legislature will understand the essential role that nonprofits have in both Massachusetts’ economy and society. A nonprofit tax would only hurt jobs and make life harder for the populations served by the state’s nonprofits.

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