The Boston City Council Wednesday unanimously approved the use of its long-time property tax formula for the upcoming fiscal year, locking in an increase in residential taxes in 2026.
The vote comes amid a renewed push from Mayor Michelle Wu urging the state legislature to allow the city to shift more of the tax burden onto commercial properties beyond the legal limit. Wu has said that would have spared Boston homeowners from seeing a 13% increase in their 2026 tax bills.
Multiple lawmakers, including two state senators who represent Boston, opposed the proposal — pointing to a broad decline in commercial property values and the fact that the city already taxes its commercial properties at a higher rate than residential properties.
In a statement Wednesday, Wu thanked the council for their action and pointed to her stalled home rule petition once again.
“As residential property owners are set to pay their highest share in property taxes in over 40 years, our legislation awaits state approval that would stabilize taxes, protect residents and help businesses continue to benefit from strong city services,” said the mayor.
In public remarks Wednesday, multiple councilors stressed that they approved the lowest possible residential property tax rate allowed under state law and renewed a homeowners exemption that reduces the tax bills on owner-occupied primary residences.
“When factoring the residential exemption, these actions will provide the maximum amount of relief for homeowners under our current state laws,” said Council Ways and Means Chair Brian Worrell, adding that the council weighed multiple tax scenarios at a hearing earlier this week.
“At Monday’s hearing, we also discussed a number of financial issues facing the city, as well as the numerous tax measures that this council has supported and passed during this term that are awaiting action at the State House. But, today’s vote is solely about providing the maximum amount of relief for our residents,” he said.
“Looking ahead to the new year and the upcoming budget season, we must commit to better stewardship of city spending,” said at-large Councilor Erin Murphy. “If we are serious about protecting already burdened homeowners, we cannot simply count on commercial property owners to shoulder more of the tax burden when they too are struggling. It is time to prioritize fiscal restraint and responsible budgeting.”
District 8 Councilor Sharon Durkan criticized the legislature’s lack of action on Wu’s proposal.
“I have shared, and it’s been in the media, how upset I’ve been with the Senate,” she said. “I think if you represent Boston, you need to represent Bostonians, you need to make sure that they have an affordable place to live. And for young families and low-income seniors in my district, the lack of action from the Senate has a ripple effect. It has a destabilizing effect.”
Boston’s tax configuration allows the city to tax commercial and residential properties at different rates and typically gets more of its property tax levy from the commercial side. State law sets the ceiling for commercial property taxes at 175% of what the commercial share would have been if all properties were taxed at the same flat rate. Councilors approved this, along with a 35% residential exemption.
The formula, according to Boston’s Assessing Commissioner Nick Ariniello at a hearing earlier this week, means that residential property values will be taxed at $12.40 per $1,000 in value in the coming year — up from $11.58. Commercial properties will see a tax price of $26.96.
This formula has typically yielded tax bills for Boston residents that are below the state mean. But as residential values have risen and commercial values have declined in the wake of the COVID-19 pandemic, homeowners have begun to see spikes in their annual tax bills.
The city’s budget has also increased by more than 4% within the last year, driven by increased spending on Boston Public Schools and pension payments according to analysis from the Boston Municipal Research Bureau.
The vote also came as Mayor Wu marked a celebration of city services over the last year in which she touted 50 miles of street resurfacing, upgrading more than 2,200 lighting fixtures and filling more than 4,000 potholes. In a press release Wednesday, Wu described the actions as “historic strides” in improving services for Boston residents, issuing a subtle reminder of where the City of Boston has budgeted money that comes chiefly from property taxes.
