News Summary

A pro-business coalition, the Mass Opportunity Alliance (MOA), is challenging claims about the rise of millionaires in Massachusetts since the Fair Share Amendment. They argue that high earners are leaving due to the new surtax on incomes over $1 million. While some data indicates a rise in millionaires, MOA contests the methodology, stating that it doesn’t accurately reflect the tax’s effect. Conversely, supporters assert the surtax has provided necessary funding for public initiatives. This ongoing debate highlights the implications of tax reforms on state economics.

Boston – A pro-business coalition known as the Mass Opportunity Alliance (MOA) is disputing claims that the number of millionaires in Massachusetts has climbed since the implementation of the Fair Share Amendment, commonly referred to as the “millionaire’s tax.” According to MOA, an analysis of data suggests that a report from the Institute for Policy Studies (IPS) is filled with misleading statistics and flawed research methods.

Christopher Anderson, president of the Massachusetts High Technology Council, which co-founded MOA, indicated that the state’s already high tax burden, further compounded by the new surtax, is compelling high earners to exit Massachusetts. The Fair Share Act, which was enacted in November 2022, imposes an additional 4% surtax on income exceeding $1 million, with the revenue earmarked for education and transportation initiatives.

MOA references IRS data revealing that while the number of individuals earning over $1 million rose prior to the surtax, it saw a noticeable decline after. Notably, the analysis highlighted that leading moving companies like U-Haul and United Van Lines reported Massachusetts has one of the highest outbound move rates in the country. A recent survey conducted by MOA concluded that tax policy is the predominant reason driving residents to leave the state.

In a related report, the Massachusetts Society of CPAs’ 2025 Public Policy and State Competitiveness Report indicated that 70% of certified public accountants had high-income clients who changed their primary residence in the past year. The data presented by MOA aligns with concerns about high-income earners leaving Massachusetts for states with more favorable tax environments.

In defense of its findings, the group Raise Up Massachusetts, which backed the Fair Share Amendment, supports the IPS study’s conclusions, arguing that affluent residents are not departing the state as suggested by MOA. Compounding the debate, the UMass Donohue Institute noted that Massachusetts experienced its most significant population increase in six decades in 2023.

Contrary to MOA’s claims, data from IPS indicates that the count of millionaires and ultra-wealthy individuals in Massachusetts surged between 2022 and 2024. The report highlighted a 39% increase in millionaires, rising from 441,610 to 612,109 during this timeframe. Additionally, the number of individuals with net worths exceeding $50 million also grew by 35%, from 1,954 to 2,642.

MOA has challenged the IPS’s methodology by noting that it relies on data from Wealth-X, which measures net worth rather than income, raising questions about its relevance in the current tax landscape. Omar Ocampo, lead author of the IPS report, acknowledged that although certain high-income earners may be leaving due to the surtax, this exodus has not substantially impacted the state’s overall tax base.

Looking ahead, revenues generated from the millionaire’s tax are projected to reach $2.4 billion for fiscal year 2026, illustrating the significant income tax contributions associated with this initiative since its introduction. In comparison, other states like Washington have reportedly experienced an influx of high-income residents following similar tax reforms, drawing attention to the viability of high-income tax structures.

While critics of the millionaire’s tax caution that the state risks losing high-income earners to more tax-friendly destinations such as New Hampshire and Florida, proponents of the tax assert that it has provided essential funding for public education and transportation projects in Massachusetts. They emphasize the positive effects this funding has had on state resources and infrastructure.

As the financial landscape continues to evolve, Massachusetts is on track to collect slightly more revenue from the millionaire’s tax in fiscal year 2026 compared to the prior fiscal year. The ongoing debate between MOA and IPS remains central to understanding the implications of the millionaire’s tax on wealth distribution and state economics in Massachusetts.