State finances are treading water, and there’s growing fear on Beacon Hill that voters could soon yank Massachusetts below the surface. 

The annual fiscal check-up that state budget-writers convened Tuesday featured the same calls for caution and warnings about a volatile environment that have dominated conversations for the past year-plus. But this time around, the 2026 election also emerged as a point of concern. 

That’s because influential business groups are pushing a pair of ballot questions that would trim the state’s income tax rate by one-fifth and make it much more likely for the state to owe refunds to taxpayers. 

If the proposals earn a spot on the ballot and secure enough support from voters, they could carve billions of dollars out of the revenue foundations on which lawmakers have built their quickly growing spending plans. 

House budget chief Aaron Michlewitz went out of his way at Tuesday’s hearing to lament the potential impacts, warning that they could compound the already-potent stress of federal funding cuts and a wobbly economy. 

“Given these realities and the funding priorities that Massachusetts needs to realize in order to continue to be a top-tier state, now is not the time for irresponsible ballot questions,” Michlewitz said during his opening remarks. “These questions would only benefit high-end earners and would require either dramatic spending cuts or other tax increases in order to maintain the Commonwealth’s fiscal stability.” 

Michlewitz did not explicitly identify which of the dozen prospective questions are giving him agita, but he almost certainly was referencing the two backed by the Massachusetts High Technology Council, the Pioneer Institute, and the Massachusetts Competitive Partnership, which together launched a group called the Massachusetts Opportunity Alliance. 

One of the coalition’s questions would gradually reduce the state’s income tax rate from 5 percent to 4 percent, and the other would overhaul the voter-approved cap on allowable state tax collections, forcing more frequent returns of tax dollars. 

Proponents say the measures could reduce the burden on Bay Staters, who face a notoriously steep cost of living. 

“People who leave Massachusetts cite high costs, and taxes are the top of that list,” Mass. High-Tech Council president Chris Anderson said last month. 

But tax relief always requires a tradeoff by the state.