Today, the Senate Committee on Ways and Means (SWM) released its tax relief proposal. The plan, which mirrors the tax bill passed by the Senate in 2022, includes seven major tax relief provisions and carries an estimated Fiscal Year (FY) 2024 cost of $594 million.1 Like Governor Healey’s proposal, the plan also includes a number of smaller tax provisions not addressed in the House bill, including an increase to the state’s Housing Development Incentive Program (HDIP) cap and adjustments to the Low Income Housing Tax Credit (LIHTC).

A strength of the SWM tax bill is its focus on housing. Reforms to the HDIP and LIHTC programs will incentivize the production of affordable rental housing and improve opportunities for home ownership. However, compared to the bills put forward by Governor Healey and the House, the proposal represents a step back. Its exclusion of capital gains tax reform and more limited estate tax and child and dependent tax credit relief undercuts its ability to meet two key goals: promote Massachusetts’ competitiveness and address high costs of living.