BOSTON (WWLP) - A new business tax in Massachusetts is being singled out as the "most burdensome" in the United States.
The Massachusetts Taxpayers Foundation released a report that says the state's new tax on computer software services is the largest and broadest in the country.
The report finds that no other state taxes computer and software design services on as great a scale and cost than Massachusetts.
Four states, Hawaii, New Mexico, Connecticut and South Dakota tax computer software services, but at lower rates.
The new law that went into effect on July 31st applies a 6.25 percent sales tax to businesses in up to ten new categories of computer software services, including the design, consultation, upgrade and installation of software.
Michael Widmer, President of Massachusetts Taxpayers Association, told 22News, “Software essentially runs the modern economy and now we're taxing it here and that is supposed to be one of our great economic strengths and now we're making it a liability.”
Legislation and a 2014 ballot petition have been filed to repeal the new tech tax.
The tax is expected to generate about $160 million in revenue for the state's transportation needs.