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Secretary of State William Galvin’s office came out in opposition Tuesday to Gov. Maura Healey’s idea to slash the state fee for starting a new limited liability company by 80 percent.
In testimony to the Joint Committee on Economic Development and Emerging Technologies, the director of the Corporations Division under Galvin’s office said the proposal within Healey’s economic development plan (H.5386) threatens tens of millions of dollars in annual state revenue. She also told lawmakers that the secretary’s office doesn’t see the filing fee, which Healey said is the highest in the nation, as a significant barrier to business creation here.
“We respectfully disagree with the governor’s office that the filing fee impacts the formation of businesses in Massachusetts,” Marissa Soto-Ortiz said. “LLCs are organized four to one over corporations. In fact, in a recent study done by Wolters Kluwer, Massachusetts has seen an almost 8 percent increase in new formations … of their study of 47 states, Massachusetts was the 14th highest for new formations over the last two years.”
Under Healey’s bill, the fee for starting a new LLC would drop from $500 to $100. The legislation would also discount the $500 fee for the first (to $200), second (to $300), and third (to $400) annual reports businesses must file. Healey said the proposal is about making it easier to start and grow a business in Massachusetts.
“This fee structure has a disproportionate impact on entrepreneurs from disadvantaged communities, who are less likely to have access to upfront capital and may find it hard to pay a $500 filing fee on top of all the other costs of starting a small business. It is time to change that,” Healey wrote last month in her filing letter. “This long-overdue update sends a strong signal that Massachusetts embraces entrepreneurship and is committed to making it easier to start a business.”
Soto-Ortiz said there were more than 48,000 LLCs formed in Massachusetts in 2025, generating more than $24 million in revenue in filing fees alone. She said her division also initiates administrative dissolution projects against LLCs that fail to file their annual reports. Those dissolution projects typically generate between $14 million and $20 million in additional revenue for the state each year, she said.
Soto-Ortiz also claimed that reducing the filing fee “is going to increase fraudulent filings,” though her two minutes to testify expired and she did not elaborate.
No member of the committee had a question for Soto-Ortiz, though Chairwoman Rep. Carole Fiola had a comment.
“Just because they’re opening businesses doesn’t mean that it’s not a struggle or it’s not difficult for the local businesses. From what I hear on Main Street and in my city of Fall River, businesses are feeling it. That’s why we’re struggling,” she said. “So, I get you, I understand we have to consider if we’re ever going to propose cutting, what does that mean? So, I’m glad to at least have quantifiable numbers.”
