Politics & Government

GOP Lawmakers Stop In Wakefield To Urge Repeal Of Tech. Tax

6.25% sales tax on custom software and network design services will discourage tech. businesses from taking risks and motivate more of them to leave the state, warned lawmakers during a stop in Wakefield.

State Republican lawmakers held a roundtable forum in Wakefield Thursday afternoon to highlight ongoing efforts to repeal the 6.25% sales tax on custom software and network design services that was included in Governor Deval Patrick's budget this year. 

"This is a dangerous tax in my opinion because for the first time, it taxes a service in the Commonwealth of Massachusetts," said State Senate Republican Leader Bruce Tarr. "It's taxing the innovation economy... Something Massachusetts has typically been a leader in." 

House Republican Leader Brad Jones and Rep. Donald Wong, whose district includes part of Wakefield, were also among the participants at the roundtable, which also included area business owners and representatives from the Massachusetts High Tech Council and the Wakefield Chamber of Commerce. 

The discussion focused heavily on concern that the new tax could result in the state losing jobs from an industry it has become a national leader in. Several business owners in attendance also described the difficulties, questions, and lack of clarity from the state that they've encountered in trying to comply with the law. Another point that came up was the irony of state lawmakers taxing an industry that makes it easier for people to stay home to work, putting less strain on the transportation system that the new tax is intended to help fund. 

Rep. Jones, whose district includes Lynnfield and North Reading, warned that if this current tax isn't repealed, another industry will likely find its services targeted for revenue the next time a significant state budget shortfall materializes. 

"This tax is just another roadblock for those willing to take risks," said Shirley Singleton, CEO of Edgewater Technologies in Wakefield, while company vice president David Clancey noted that the 6.25% tax reduces the cost of moving operations to New Hampshire  or the South by that much more. 

While Thursday's forum was organized by Republican lawmakers, they indicated that some Democratic lawmakers are also apparently open to a repeal. If a legislative repeal fails to get traction, efforts are also underway that put a ballot initiative before the voters in next year's election. 


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