NO RECOMMENDATIONS, BUT SENATE REPORT WILL HIGHLIGHT RETAIL CHALLENGES
By Katie Lannan
STATE HOUSE NEWS SERVICE
STATE HOUSE, BOSTON, MAY 7, 2018....As retailers continue to pursue a ballot question to lower the state's sales tax, a Senate task force convened last year is wrapping up work on a final report that spotlights other challenges facing the industry, including premium pay for Sundays and holidays.
The 13-member task force plans to vote on its final report on May 30, and discussed a draft version at a meeting Tuesday.
Jon Hurst of the Retailers Association of Massachusetts talked to senators at a task force meeting Monday about the rising cost of retail operation. [Photo: Sam Doran/SHNS]
The report does not make policy recommendations and instead summarizes the panel's findings after a series of meetings and hearings throughout the state.
The retail sector, according to the draft, remains important to the state's economy as it faces both "profound challenges and opportunities."
Massachusetts brick-and-mortar retailers face a "competitive sales tax disadvantage" when compared to online sellers and their counterparts in tax-free New Hampshire, while also dealing with high costs of living, state mandates, and changing consumer demographics and preferences, the draft report said.
"I think the draft report is accurately reflecting what they heard on the road and that there are concerns," task force member Jon Hurst, head of the Retailers Association of Massachusetts, said after the meeting. "Something's happening out there where retail sales, for a lot of them, are not increasing, yet their costs of operation are increasing, and that's hard to keep your doors open when you can't raise your prices, can't raise your sales to reflect your increasing costs of operation. That's what we have to really focus on here in the commonwealth."
The association has proposed a ballot question that would lower the current 6.25 percent sales tax to 5 percent and institute an annual sales tax holiday.
Last week marked the deadline for legislators to act on initiative petitions, leaving ballot campaigns free to begin gathering the next round of signatures -- 10,792 are required at this stage -- to put their questions before voters in November.
"We are at the point now that we can start collecting signatures, and, look, we have to, because who knows what will happen," Hurst told the News Service. "We're hopeful that there will be some more discussions and more moderate types of public policy that will keep us from having to submit those signatures. There's still a lot of time. July 3 is the final drop-dead date to submit them, so we'll see what happens over the course of the next eight weeks."
Voters are also poised to decide on questions that would gradually raise the minimum wage to $15 an hour and establish a paid family and medical leave program in Massachusetts, though a deal potentially could be reached by lawmakers and campaigns to keep any or all of these measures off the ballot.
The Labor and Workforce Development Committee last week extended until July 2 its deadline to report out paid leave and minimum wage bills, and the coalition backing those initiatives plans a State House rally Tuesday to ask lawmakers to pass those bills into law. Also last week, Gov. Charlie Baker said he hopes to see all of the ballot questions addressed through the legislative process.
The retail task force noted in its draft report that a $15 minimum wage could have additional ramifications for retailers, who labeled the requirement that they pay workers time and a half on Sundays and holidays as a "top concern."
"In today's environment, retailers stated that the blue laws can pose a significant burden on Massachusetts businesses and provide another competitive advantage to remote sellers," said the report, which task force members read aloud during Monday's meeting. "The task force heard from small retailers that they would have to limit employees' hours on Sunday or even close on Sunday altogether to afford both the $15 minimum wage and premium pay wages."
On another payroll matter, the report said retailers also asked for a training or teenage wage that would allow them to pay first-time or younger workers less, a practice used in one form or another in all but 11 states.
Harris Gruman, the executive director of the SEIU Massachusetts State Council, said some states that allow such subminimum wages have do so in a "highly restricted" manner, for example by limiting the number of hours for which the lower rate can be paid.
"The other side of the coin, which I think is equally important, is there are over a dozen states, over 15 states I believe, that pay everyone under 19 years old $4.25 an hour, which is appalling," he said. "When I tell people that, they drop dead."
The report said statewide coordination, promotion and support are needed to continue strengthening the retail sector. It stopped short of recommending specific fixes, a move members said was in keeping with the July 2017 order that established the panel.
The order, offered by former Sen. Stanley Rosenberg, who was then Senate president, and Senate Minority Leader Bruce Tarr, called for the task force to "review and report on efforts to strengthen the local retail sector in the commonwealth" and did not speak to recommendations.
Sen. Michael Barrett, who serves on the panel, said that when it does release its final report it should make clear that issuing specific recommendations was not part of its purview.
"The press will be frustrated," the Lexington Democrat said. "They'll want us to make the call on issues like the tax holiday, like the training wage, and if we're not prepared to make the call, we need to clarify that."
In 2009, the year the Legislature raised the sales tax to 6.25 percent, task force chairman Sen. Michael Rodrigues, then a state representative, was spotted purchasing alcohol at a New Hampshire liquor store. At the time, according to MassLive.com, Rodrigues said he wasn't attempting to evade a new sales tax on liquor that he supported and that he would comply with state law and pay the Massachusetts sales tax on the liquor when he filed his tax returns.
Serving the working press since 1894