Bay State voters rekindle tax-cut fervor with cap on real estate levies

Tax-burdened Massachusetts voters have had it with high property taxes. By a 3-to-2 margin they have approved a Nov. 4 ballot measure to roll back real estate levies and slash automobile excise taxes.

The controversial new law, patterned after California's controversial Proposition 13, breezed through despite still opposition from public employee unions and other concerned with its impact.

The measure restricts a community's total property tax yield to 2 1/2 percent of the full market value.

The new law faces an uncertain future since state lawmakers in anticipation of the angry message from the electorate have been readying a variety of amendments to soften its impact.

In response, backers of Proposition 2 1/2, as it is called, are bracing to turn back any attempt to weaken the law.

But with the election over, and lawmakers safely in office for another two years, it is questionable how successful the tax-cutting activists might be.

If implemented, more than half the 351 cities and towns will have their taxes lowered, the biggest reductions coming in older and poorer urban centers.

Boston, for example, would face a 70 percent budget reduction over the next three years. Critics of the restrictive measure conend this will lead to massive public employee layoffs and reduction or elimination of some present municipal services.

The measure does not limit city spending in general, only that which is funded through real estate taxes. This, if nothing else, could force city and towns to lean more heavily on the state to increase local aid. It is questionable, however, whether the commonwealth can afford to provide additional financial assistance without boosting state taxes.

Passage of Proposition 2 1/2 could force a hike in either the 5 percent limited sales tax or 5 percent personal income tax, the Bay State's main revenue sources.

Gov. Edward J. King, who was elected two years ago on a tax-cutting plank and pledged in his campaign to bring about $500 million reduction in property taxes, now is particularly on the spot. Proposition 2 1/2 would, according to its sponsors, achieve this goal over the next few years.

Governor King did not support the ballot measure, although his opposition was decidedly quiet, perhaps partially because its prime backers were leaders of the state's high technology firms, a major source of King political support.

Renters, as well as homeowners, would benefit from the new measure since they would gain a state income tax exemption of up to half of the yearly rent.

This feature along, with the chopping of the motor vehicle excise tax from $ 66 per $1,000 valuation to $25 per $1,000 helped gain support for the initiative petition.