Independent analysts diverge on revenue outlook; warn ballot questions and capital‑gains volatility could reshape FY27

Independent witnesses gave competing forecasts and urged lawmakers to consider volatility and ballot risks as they set consensus revenue.

Doug Haugate of the Mass Taxpayers Foundation recommended conservative planning: his non‑surtax FY26 estimate was roughly $41.1 billion with surtax modeled separately and a cautious FY27 non‑surtax projection near $42 billion. He urged limiting use of the Stabilization Fund to temporary shocks rather than to backfill permanent federal policy changes.

Evan Horowitz of Tufts presented a higher scenario, saying, "We estimate state tax revenues will total $47,100,000,000," and argued inflation plus recent stock‑market gains support a stronger top‑line forecast. Horowitz cautioned, however, that the state’s increased reliance on capital gains and the millionaires tax increases volatility and makes April filings an especially risky hinge point for final collections.

Alan Clayton Matthews (Northeastern) offered an alternative projection showing FY26 near $43.6 billion and FY27 near $46.5 billion, noting demographic trends—declining working‑age population offset by productivity gains—that influence longer‑term capacity for revenue growth.

All three analysts flagged the potential fiscal impact of a ballot question to cut the income tax to 4%: model estimates presented at the hearing place annualized losses in the multiple‑billion‑dollar range, with staging and taxpayer behavior determining how much would affect FY27. Witnesses recommended close tracking of monthly collections and estimated payments so the legislature can respond as actual data arrive.