Officials also decide to shift Homestead Property Tax Credit rate from 3% to 0%
As part of their fiscal year 2026 budgeting, the Worcester County Commissioners have decided to both lower the income tax rate and set the homestead tax credit rate to zero.
Officials said they hoped the moves will offer some financial relief to residents and taxpayers, given the county’s estimated $7.85 million budget surplus going into fiscal year 2026, which starts July 1. The current surplus includes major decisions made in recent weeks, including slicing the proposed cost-of-living-adjustments from $4,000 for county employees to $2,000.
At Tuesday’s budget hearing, the Commissioners voted unanimously to drop the county’s income tax rate a quarter of a percent, from 2.25% to 2%.
“That would help retirees, and with the income tax reduction by a quarter percent, we would be helping working people,” County Commissioner Chip Bertino said at Tuesday’s budget meeting. “So, we’re getting both ends there.”
Reducing the income tax does represents a potential revenue loss to the county: about $1.9 million for fiscal 2026, as well as another $5.5 million for the 2027 fiscal year, according to county administration.
Worcester is projecting a massive tax revenue windfall for 2026, the result of higher property tax assessments that yielded about $18 million in new revenue.
The county is also projecting about $6 million more from income tax revenue. Other revenue increases of about $1.4 million came from real estate and transfer taxes.
Not all that money is fair game for spending. County policy mandates setting aside 15% of revenue in reserves, as well as 22.2% of income tax revenue toward employee pensions.
MAGA !!!