Small tax cut to take effect in Mass. - Boston News, Weather, Sports | FOX 25 | MyFoxBoston

Small tax cut to take effect in Mass.

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BOSTON (AP) - Massachusetts taxpayers will ring in the new year with a tax cut - but a very small one.

The state's income tax rate drops from 5.25 percent to 5.2 percent on Wednesday. A state law requires an automatic .05 percent reduction in the rate when growth in state revenues exceeds certain benchmarks.

The Revenue Department says tax collections through November were running $766 million, or 9.7 percent, ahead of the same period in the previous financial year.

For most taxpayers, the Jan. 1 reduction will save less than $50 over the course of the year. But it will have an impact on state finances, with officials predicting a $65 million loss in revenue the state would have otherwise taken in for the remainder of the financial year that ends July 1.

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