The CTMirror has posted a copy of Malloy’s tax plan: http://ctmirror.org/sites/default/files/documents/tax%20proposal.pdf and a corresponding story http://ctmirror.org/story/11505/malloy
More analysis to come in the coming days – but if you go outside – you’ll probably hear Connecticut’s wealthy popping the champagne bottles and toasting this tax proposal.
An new income tax rate of only 6.7% for those making over a $1 million while eliminating the all important property tax credit — which is probably the single most important tax policy for middle-income families?
I suppose the good news is that since the top income tax rate will remain so much lower than New York and New Jersey – let alone – New York City that we can rest assured that our super wealthy won’t be selling their homes, pulling their kids out of school and heading to safe havens…
While the Administration will argue that the plan builds some “progressivity” into the income tax, it is limited at best and because it removes the all important property tax credit from the income tax it is a major hit to Connecticut’s middle income taxpayers.
Even in the worst of the previous two recessions the property tax credit was never reduced below $300 – now he is proposing eliminating it – a shocking hit to every middle class homeowner.
The plan also raises the gas tax – which disproportionately hurts middle class, working families who have no choice but to use their cars to get to work and meet the challenges of daily life. It also increases the sales tax rate and taxes clothing and non-prescription drugs…
But his does not broaden the sales tax to a variety of business services such as advertising.
We’ll know more in the coming days – but as of now – the wealthy in Connecticut pay about 5% of their income in state and local taxes while the rest of us pay about 10% of our income in state and local taxes. This plan does little (if anything) to balance Connecticut’s tax burden on middle income families.
At first blush – at least – it is a plan that would make a Republican governor proud!