GOV. MAURA HEALEY is proposing a tax reform package that addresses cost-of-living concerns of parents, renters, and seniors while providing significant relief to wealthy individuals who may be turned off by the recently passed millionaire tax and the state’s tax treatment of estates and capital gains.

The Democratic governor’s proposal hews closely to the playbook of her predecessor, Republican Charlie Baker, who came close to passing a similar package last session before lawmakers became skittish about enacting permanent tax cuts while returning $3 billion to taxpayers under the tax cap law.

“This proposal centers affordability, competitiveness, and equity each step of the way, delivering relief to those who need it most and making reforms that will attract and retain more businesses and residents to our great state,” Healey said in a statement released in advance of a Monday morning event in Lynn where she unveiled the package.

The budgetary impact of the tax package in the upcoming fiscal year will be an estimated $742 million, but the annualized cost will run closer to $1 billion.

Healey’s tax reform package would also increase the initial annual cap on housing development tax credits from $10 million to $50 million in the coming fiscal year to address a backlog of projects before lowering it in subsequent years to $30 million a year. The Housing Development Incentive Program, or HDIP, is seen as a key factor in increasing the production of housing in Gateway Cities.

The package also includes a new tax credit for live theatre productions and expands existing tax credits for apprenticeship training, dairy farms, septic system replacement, and lead paint abatements. In total, the expanded credits would provide $36.5 million in tax relief, according to the Massachusetts Taxpayers Foundation.

Healey had previously indicated her support for the elements of the package benefitting parents, renters, and seniors, but her backing of changes in the estate and capital gains taxes showed she was trying to address competitive concerns raised by the Massachusetts business community.

Business leaders had been pressing for similar changes in estate and capital gains taxes that have set Massachusetts apart from most other states. With the passage of the millionaire tax constitutional amendment by voters in November, business groups feared the state’s old “Taxachusetts” label might resurface and prompt an exodus of wealthy people.

“It’s a big step in the right direction,” said Doug Howgate, the president of the Massachusetts Taxpayers Foundation, in an interview. “It shows she’s pragmatic and she wants to solve problems.”

A press release issued by Healey outlining the tax plan included positive comments from officials with the Massachusetts Councils on Aging, the Massachusetts Dairy Farmers Association, and the Massachusetts Association of Early Education and Care.

The tax plan was also lauded by the Massachusetts Business Roundtable as “a thoughtful and comprehensive set of tax proposals and investments to kick off this legislative session’s competitiveness policy discussion.”

Associated Industries of Massachusetts chimed in similarly. “Based on this budget it is clear that the administration shares AIM’s concerns about the Commonwealth’s competitive future and this is a critical first step towards ensuring sustained growth and economic strength.”

Democratic lawmakers are likely to look favorably on most elements of the package. The one exception is Healey’s proposal to eliminate the 12 percent tax on short-term capital gains, which both branches took a pass on last term.

Here are the key elements of the package:

Dependent tax credit: The governor is proposing a $600 per dependent tax credit with no cap on the number of dependents eligible.  Dependents would be defined as children under 13, people with disabilities, and senior dependents 65 and older.

The size of the dependent tax credit is almost twice what the House and Senate agreed to last session and far more generous than what Baker originally proposed. The current maximum credit is $240.

The estimated annual cost of the credit would be $458 million. The Healey administration said it would provide relief to 700,000 taxpayers with a total of more than 1 million dependents.

Rental deduction: Renters are currently allowed to deduct on their state taxes 50 percent of their annual rent up to a cap of $3,000. Anyone paying more than $500 a month in rent would hit that cap. Healey’s proposal would increase the cap to $4,000, an increase that would cost the state an estimated $40 million.

Senior circuit breaker: Income-eligible seniors who use more than 10 percent of their income to pay property taxes or to cover more than 25 percent of their rent are eligible for the circuit breaker. The base credit, currently $1,200, would double under Healey’s proposal. During the last legislative session, Baker, the House, and Senate were all in agreement on this change. The cost of the circuit breaker change would be $60 million.

Estates: Massachusetts is one of 12 states that taxes estates and its tax is one of the more aggressive. It kicks in on any estate valued at more than $1 million and the tax is paid on the full value of the estate.

Baker had proposed raising the threshold to $2 million and requiring payment of the tax only on the amount over $2 million. Lawmakers last session eyed similar proposals. Business groups this session have been pushing for raising the threshold as high as $5 million.

Healey’s proposal would raise the threshold to $3 million and provide a tax credit of $182,000 toward any estate tax payment. The tax credit, under Healey’s proposal, is what would be owed on a $3 million estate, so the net effect would be that estate taxes are paid only on estates valued at more than $3 million.

The projected cost would be $167 million in the coming fiscal year. Fully annualized, the cost would be $275 million.

Capital gains: Massachusetts is unusual in that it taxes most capital gains at 5 percent but applies a 12 percent rate on gains from assets held less than a year. Healey, like Baker before her, is seeking to treat all capital gains the same at 5 percent. Lawmakers last session showed no interest in eliminating the rate on short-term capital gains.

The cost of the proposed capital gains tax cut would be $117 million, but its budgetary impact, at least initially, would be zero because the the tax cut’s enactment would merely reduce how much money flows into the state’s rainy day fund.