Massachusetts lawmakers unveiled a tax relief package Tuesday aimed at delivering $561 million in reductions to taxpayers and companies during the current fiscal year through a slew of tax credits and other steps aimed at lowering tax burdens.
The proposal — which would top $1 billion in tax relief by the 2027 fiscal year when fully phased in — includes more than a dozen specific tax proposals, from eliminating the tax for estates under $2 million to increasing the child and dependent tax credit from $180 to $330 per child or dependent in the current tax year to $440 for the 2024 tax year.
Lawmakers say the increased child tax credit will benefit 565,000 families and will be the most generous universal child and dependent tax credit in the country.
The bill would also increase the cap on the rental deduction from $3,000 to $4,000, reduce the tax rate on short-term capital gains from 12% to 8.5% and allow cities and towns to adopt a local property tax exemption to encourage affordable housing.
Democratic Senate President Karen Spilka called the proposal historic.
"It is the largest bipartisan legislative tax relief proposal in over a generation," Spilka said. "This tax relief bill will help alleviate many, many financial burdens that our families, our seniors, our renters face and put real dollars in their pockets."
A low-income household with two children will see its tax refund check increase by more than $1,000 if the bill becomes law, she said.
"This is real money," she added.
House Speaker Ronald Mariano, a fellow Democrat, also praised the bill, in particular the provision that strengthens from $1,200 to $2,400 the maximum senior circuit breaker tax credit, a refundable credit for senior citizens based on real estate taxes or rent paid on residential property owned or rented as a principal residence.
"It's one of the greatest programs that we've ever come up with in my time involved in the state where you can actually get money to stay in your house, even if you don't pay state taxes," Mariano said.
The bill is expected to be voted on Wednesday in the House and Thursday in the Senate.
If approved, the next stop is Gov. Maura Healey's office for her signature.
Healey called tax relief essential for making Massachusetts "more affordable, competitive and equitable."
"This is a comprehensive package that delivers relief to families and businesses, including through our proposed Child and Family Tax Credit," Healey said in a written statement. "I look forward to reviewing the details."
Healey released her own $742 million tax relief package in February. Her proposal would have eliminated the tax for estates valued up to $3 million. Massachusetts is one of just 12 states with an estate tax.
In April, Massachusetts House lawmakers overwhelmingly approved their own $654 million tax relief package, followed by the Senate, which unveiled a $590 million tax relief proposal in June.
The single compromise bill set to be voted on this week would also make changes to a 1986 law designed to limit state tax revenue growth and return any excess to taxpayers. The law triggered nearly $3 billion in refunds last year.
The bill would keep the law but ensure the money is paid out equally among taxpayers, lawmakers said.