A new annual report from Truth in Accounting found Connecticut has $67 billion in bonded debt and unfunded retirement costs, making it the third most indebted state per taxpayer in the nation. The total debt, which amounts to $50,700 per taxpayer in the state, is based on Connecticut’s 2019 financial ...
GE Leaves Connecticut for Boston Clarifying Need for Better Policies
General Electric announced this week it would move its headquarters from Connecticut to Boston, Mass., highlighting the need for policies focused on increasing opportunity for all Connecticut residents.
While many officials tried to cast blame elsewhere, GE officials warned lawmakers the company would consider moving if they went ahead with what amounted to a 40 percent increase in corporate taxes.
Lawmakers quickly exhibited some remorse for passing the second-largest tax increase in state history – smaller only than the tax increase they passed in 2011 – by reducing the amount of the increase twice within six months.
But these efforts to repair the damage proved insufficient. Some lawmakers, including those in leadership, are now suggesting GE’s move had nothing to do with taxes. “It’s not called ‘Taxachusetts’ for nothing,” Rep. Bob Godfrey, D-Danbury, told the CT Mirror.
Elected officials in Connecticut have formed a habit of disregarding evidence that Connecticut is inhospitable to employers.
“The people of Connecticut have three options,” said Carol Platt Liebau, president of the Yankee Institute. “We can continue to pretend nothing is wrong. We can wallow in despair. Or we can transform our policies to welcome employers and increase opportunity for everyone.”
Despite Massachusetts’ historical reputation for high taxes, Connecticut’s taxes are even higher by a number of measures.
According to the Tax Foundation, a corporate headquarters like GE would face a combined tax rate of 19 percent in Connecticut, but only 15.3 percent in Massachusetts. By this measure Connecticut ranks 44th and Massachusetts fairs slightly better, 37th.
The Tax Foundation also ranks states based on business tax climate with Connecticut again placing 44th while Massachusetts ranks 25th.
In all, state and local taxes in Connecticut consume 11.9 percent of income (3rd highest) and a slightly smaller 10.3 percent in Massachusetts (11th highest).
Massachusetts also has a flat 5.1 percent income tax compared to Connecticut’s new top rate of 6.99 percent. While GE would not pay this tax, its employees would, including the employees who made the relocation decision.
Other companies to leave Connecticut recently include Pfizer, Hallmark and Borgeson Universal.
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