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Table of Contents
- Introduction
Table of Contents
- Introduction
Introduction
During floor debate on the budget, the Senate voted to increase the sales tax from five percent to six and a quarter percent and to eliminate the sales tax exemption for alcohol. Combined, these changes are expected to generate approximately $730 million in FY2010.
The Senate used this revenue to restore about $500 million of the $3 billion that the Ways and Means Committee had recommended in budget cuts. In addition, the Senate allocated $275 million to avert a toll increase on the Massachusetts Turnpike, to address the budget crisis at the MBTA and to support other transportation programs.1
While some funding was restored during floor debate, the final Senate budget calls for the elimination of health insurance for 28,000 legal immigrants, a 34 percent cut to local aid, and deep cuts to education, human services, and public safety funding.
This analysis is preliminary, as the final Senate budget was not immediately available. We will release a more complete Budget Monitor once the final Senate budget information can be more comprehensively examined and – possibly – with information on the expected revisions by the Governor to House 1. Those revisions are expected to identify changes he will propose in response to the $1.5 billion reduction in the revenue estimate for FY 2010 that was announced just before the Senate budget debate.
1New spending in the Senate budget exceeds new state source revenue because more than $200 million of the spending restored is in the state Medicaid program and the federal government reimburses the state for more than half of the costs of most Medicaid spending.
Table of Contents
- Introduction
