Gov. Ned Lamont submitted a budget proposal on October 1 that draws down Connecticut’s Rainy Day Fund by $1.8 billion, maintains the corporate surcharge tax and implements a hiring freeze to bridge a projected $2 billion budget deficit. The proposed budget would also take $25 million back from departments and ...
Malloy’s budget and anti-privacy bills the focus of this week’s testimony
Another week of testimony at the capitol has brought some important and potentially disastrous bills to the forefront. In particular, Gov. Dannel Malloy’s budget proposals were heard before the finance, revenue and bonding committee on March 9. Below are the bills that could have a big affect on you and your checkbook this year.
Yankee Institute opposed:
Both these bills would force nonprofit 501(c)(4) organizations to disclose their private donors, which the government would list in online databases. This law is contrary to the U.S. Supreme Court ruling of 1958 which said that donations made to advocacy groups should remain private. Listing donors would expose citizens to the potential for harassment and political pressure. Instances of such harassment have been well documented around the country. During a time of extreme political partisanship, citizens should not have to worry that they will be singled out and harassed for their personal viewpoints. Our votes at the ballot box are private, our contributions to advocacy groups should remain private also.
Governor’s Bill 7050: An Act Concerning Enhancements to Municipal Finance and Accountability
Gov. Malloy’s budget proposals are wrapped in two big pieces of legislation which has some good things and some bad things, so we’re breaking them down piece by piece.
Shifting one-third of teacher pensions onto municipalities: This will be a major cost to towns and will cause increases in property taxes. Furthermore, Connecticut’s towns and cities have no say in the negotiating of teacher retirement benefits, nor did they have any say in the underfunding of that pension system. Property taxes are high enough already, this will increase the tax burden on the people of Connecticut.
Allowing municipalities to charge property tax on hospitals: These taxes will cause healthcare costs to increase for consumers and hurt hospitals, many of which are already struggling. Gov. Malloy’s previous tax on hospitals was not distributed back to them as he promised, but instead was used to pay down the deficit. The governor’s office claims that paying property taxes will somehow benefit hospitals but given Connecticut’s history, there is little reason to believe this.
State oversight of distressed municipalities: The state has been funding these cities for years and there have been few substantial changes. If Connecticut is going to continue bailing out poorly run cities then it should have some say in the city or town’s fiscal decisions. Yankee Institute supports this provision.
Governor’s Bill 787: An Act Concerning Revenue Items to Implement the Governor’s Budget
Increasing the bottle deposit: Yankee Institute opposes increasing the bottle deposit from 5 cents to 10 cents. Recycling has never been easier than it is now and this would just be another way to “nickle and dime” Connecticut residents.
Increasing user fees for municipal land record-keeping: Tripling this fee makes it look more like a revenue-generating tax, rather than a fee. Home buying in Connecticut is expensive enough already and this would simply punish people trying buy a home.
Increasing the price of background checks: This will further burden businesses that have to perform these checks and those costs will be passed on to the consumer.
Increasing the cost of pistol permit applications and renewals: Once again, this increase of 400 percent for the pistol permit fees makes it more of a tax rather than a fee. Revenue estimates from the increase might also be overly optimistic as the increased cost may drive down the number of renewals.
Increasing the tobacco tax: The tobacco tax has proved to be an unreliable source of revenue. This increase will cause more black-market sales, harm small businesses and drive people across the border to other states to make their purchases.
Eliminating minimum bottle pricing for alcoholic beverages: Connecticut should eliminate the minimum bottle pricing for alcoholic beverages. This is a good free-market policy that will increase competition and sales while driving down prices for buyers.
Reforming the estate tax: Connecticut should also reform its estate tax exemption to match the federal estate tax standard. This tax is driving out the high-income individuals the state needs to generate revenue through other taxes. We need to make Connecticut a place where people want to live out their retirement and pass along their assets to their children.
Lowering the insurance premium tax: Yankee Institute supports reducing the insurance premium tax. Insurance is one of Connecticut’s flagship industries and the tax cut will benefit both the insurance businesses and consumers by lowering costs.
Lowering the film tax credit: Yankee Institute also supports curtailing the film tax credit. This tax scheme is too narrow to generate any real benefit to the state. It is expensive on the front end and rarely produces the economic activity needed to make it affordable.
Study finds Connecticut government employees earn 28 percent more than private sector, costing taxpayers $3.7 billion
An updated study published by the Yankee Institute on Wednesday found that Connecticut government employees earn 28 percent more than comparable private sector employees, largely due to public employees’ generous retirement benefits. That difference adds up to a total of $3.7 billion in tax dollars across all state and local ...