[Hidden-tech] Fwd: New IT services tax in Massachusetts - constituent communication

[Jeff Rutherford]

Response from Rep. Stephen Kulik. I encourage everyone to contact state legislators about this tax. They need to hear from a lot of people!

Jeff Rutherford
413-475-0087

Begin forwarded message:

> From: "Kulik, Stephen - Rep. (HOU)" <Stephen.Kulik at mahouse.gov>
> Date: August 8, 2013, 10:05:40 PM EDT
> To: Jeff Rutherford <jeffrutherford at gmail.com>
> Subject: RE: New IT services tax in Massachusetts - constituent communication
> 
> Jeff,
> 
> Thanks very much for sharing your concerns about this.  As you know, the legislature scaled back governor Patrick's much more expansive tax proposal that he submitted in January.  Our intent was to craft something more limited and narrower in scope.  I am aware of the concerns that have been raised by some in the business community in the past few weeks.  We are looking at these concerns very carefully, as we do disagree on some of the interpretations being talked about.  If we have created something that was not our intent, we have promised to revisit and change it.  It is certainly not our intent to raise $500 million as some claim, and to harm our tech sector. Our estimate is that this will raise about $160 million, and apply to a limited number of services.  This will be clarified in the coming weeks as DOR writes the regulations.  This is a work in progress, so stay tuned, and I appreciate your input.
> 
> Best,
> 
> Steve
> 
> Rep. Stephen Kulik
> First Franklin District
> Vice Chairman, House Ways & Means Committee
> State House, Room 238        1 Sugarloaf Street
> Boston, MA 02133                South Deerfield, MA 01373
> 617-722-2380                        413-665-7200
> Email: Stephen.Kulik at mahouse.gov
> From: Jeff Rutherford [jeffrutherford at gmail.com]
> Sent: Wednesday, August 07, 2013 3:12 PM
> To: Kulik, Stephen - Rep. (HOU)
> Subject: New IT services tax in Massachusetts - constituent communication
> 
> Representative Kulik,
> 
> I'm a resident of Conway, MA. I have worked in public relations for digital companies for the past 16 years. I'm writing you to strongly urge you to do everything within your power to stop the new IT services tax immediately. I don't think you or any of the other legislators realize the damage you've already caused.
> 
> The IT and information economy is going to be the driver of the American economy for many years to come. By passing the new IT services tax, you've basically shut down Massachusetts from thriving as a state in the future. Venture capitalists are now re-considering their future investments in Massachusetts digital companies.
> 
> I understand that you get a lot of passionate emails and contact from constituents. Again, I urge you to take this very, very seriously. I think because of the legislature's lack of understanding of the software business - you've just fired the first shot in crippling the state's IT economy. I'm not saying that out of hyperbole. I'm very serious. Damage has already been done, and the legislature HAS to repeal this tax immediately.
> 
> Here are some additional points:
> 
> This tax was levied on software and IT services as part of a transportation bill. In fact, there are many IT and software-related companies in Massachusetts whose employees work from home on a regular basis - or the companies are virtual companies where every employee works from home. IT services and software companies should not bear the responsibility for funding a transportation infrastructure that their companies often don't use - especially when compared with other industries within the state.
> 
> This bill was clearly written by someone who does not understand the information economy. The bill is confusing, opaque, arcane, and clearly written by someone who doesn't understand the IT economy. If the legislature wanted to tax IT and software services in Massachusetts, why didn't they have the decency to hire a law firm familiar with the industry to write the legislation? The fact that the legislature didn't take that step clearly proves that the Massachusetts legislature doesn't respect or care much about an industry that is vitally important to the future of the state economy.
> 
> The Massachusetts legislature and governmental organizations need to decide - do they want Massachusetts to be competitive in the information economy? By passing this bill, the answer is clearly NO. Venture capital remains a huge driver of investment in IT startups. The Massachusetts legislature waved a huge red flag for VCs when they passed this bill. That flag currently reads - DO NOT INVEST IN MASSACHUSETTS' DIGITAL START UPS - spend your money in Silicon Valley or Chicago or New York City. Do not invest in Massachusetts, because the state is being administered by legislators who are going to pass regulations hampering IT businesses - regulations written by people who don't understand (or care to understand) your industry.
> 
> On a personal level, I'm flabbergasted by this tax. Sure, you can make lots of arguments about the revival of small manufacturing and lots of other industries. However, the impact of the IT and information economy is only going to grow. IT and software will eventually impact almost every single industry - agriculture, healthcare, manufacturing, etc. The cities and states that create hospitable environments for IT and software companies will thrive in the future - the states who tax an IT industry it doesn't understand will not thrive.
> 
> If Massachusetts wants its economy to grow, and the state's economic developments are sincere, it needs to do everything it can to increase the growth of the IT industry and IT investments within the state. This tax is the wrong idea at the wrong time.
> 
> Please take this seriously and repeal the IT services tax immediately.
> 
> Sincerely,
> 
> 
> Jeff Rutherford
> PO Box 714
> Conway, MA 01341
> 413-475-0087
> 
> jeffrutherford at gmail.com
> 
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