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In the first step toward the full repeal of the now infamous Massachusetts "tech tax," local IT businesses can claim a decisive victory. The Massachusetts House of Representatives voted 156 to 1 on Wednesday to repeal the tax from the transportation bill.
"One small step for technology, one giant leap for innovation, I guess," said Andrew Faria, CEO of iMedia Solutions and a leader in the Spark Coalition advocacy group fighting the tax, in an interview with CRN.
The tax on software services has caused a ripple of anger across the state as local businesses struggled to understand and implement the vague tax that was put into effect only a week after it was passed on July 24.
"It felt punitive," said Richard Stearman, vice president of Ashdown Technologies Inc. in Manchaug, Mass., at a press conference prior to the vote. "We felt like we were really being punished, and we were supposed to be one of the groups that was supposed to be there helping to move the economy forward, and here was this new burden that was being placed on us and not a small burden at that."
The state's tech community, which previously had been rather disjointed and quiet in the political arena, was awoken by the tax. Many banded together to face the tax, forming groups such as the Spark Coalition and planning events such as the Beacon Hill Blitz, which organized a phone call bombardment of the State House.
"In truth, I don't recall anything in which there has been this kind of change, within 60 days, to reverse course," Michael Widmer, president of the Massachusetts Taxpayers Foundation, told CRN. "That reflects, obviously, the storm that was unleashed, but it also reflects [the legislature's] decision not to wait any longer and act expeditiously."
However, at a press conference prior to the vote, legislators said the repeal isn't enough.
"What we've learned in this process is that Beacon Hill's process is broken. The legislative process is broken, and because of that the economy in Massachusetts is broken. It's devoid of jobs, opportunity, economic growth, and that is what we seek to change. It's all well and fine to repeal the tech tax today. We've been talking about that for a long time. We're encouraged by it; we've worked hard to make it happen. However, you know, there's a point in which the legislature has to do its homework," said Rep. Ryan Fattman at a press conference prior to the vote.