Tax Day (April 15) is around the corner, and for Connecticut taxpayers, it’s a bitter reminder of just how much they pay and how little they get in return.
According to a new report from WalletHub, Connecticut ranks 37th in the country for taxpayer return on investment (ROI), meaning residents are paying more than most and receiving less in return. To determine which states give taxpayers the best — or worst — bang for their buck, WalletHub compares the quality of government services residents receive to the total state and local taxes they pay in all 50 states.
Despite the state’s heavy tax burden, the report shows that Connecticut’s services fall far short of justifying the cost. The Constitution State has the 8th highest tax burden — measured among residents aged 18 and older — but ranks just 11th in overall government service quality.
Nevertheless, Connecticut did earn high marks in a few key service areas with the second-best public school system in the country, just behind Massachusetts; the 5th best public safety; and third-lowest violent crime rate in the nation, trailing only New Hampshire and Maine. These are bright spots, but they don’t tell the whole story.
WalletHub’s service ranking also weighs infrastructure and pollution, health care, and economy — areas where Connecticut’s performance starts to slip. The state ranks 25th overall for infrastructure, factoring in road and bridge quality, commute times, park spending, highway costs per driver, water quality, air pollution, and access to fluoridated water.
Connecticut’s health care system ranks 28th overall, based on metrics like hospital quality, life expectancy, infant mortality, health insurance premiums, and the overall standard of care. Its economy comes in 12th, a ranking driven by median household income, job growth, poverty levels, unemployment, and underemployment.
So, while Connecticut can point to strong schools and low crime, the rest of the service performance doesn’t come close to justifying its crushing tax burden.
“There can be a tradeoff between how much tax you pay and what you receive in return from the government,” said Chip Lupo, an analyst at WalletHub. “Several of the states with the best taxpayer ROI don’t charge any income tax, and residents pay less at tax time while receiving good-quality (though not necessarily the best) government services.”
That’s a sharp contrast with New Hampshire, which ranks first in the nation for overall taxpayer ROI. They also have the lowest total taxes per capita and places second in services.
The Granite State doesn’t even have a state income tax yet still manages to give taxpayers a laudable return in delivering solid government services — something high-tax states like Connecticut haven’t figured out.
Connecticut fares poorly even among its peers in the region except Vermont which ranked 40th overall and 4th worst in tax paid per capita.
Rhode Island ranks 8th overall in ROI — delivering better services while taxing less per capita than Connecticut. Massachusetts and Maine also outrank Connecticut at 34th and 23rd, respectively. Like Connecticut, they have high tax burdens, but at least taxpayers in those states are getting more for their money.
To the south, New Jersey and New York — both high-tax states like Connecticut — aren’t exactly well-oiled machines either, ranking 35th and 44th overall.
Among the top-performing states in ROI are Florida (2nd) and South Dakota (3rd) — neither of which imposes a state income tax.
Political affiliation appears to play a role too. Red states dominate the top ROI rankings, while blue states are stacked at the bottom. Of the ten worst-performing states, seven are blue — including New York (44th), California (47th), Hawaii (49th), and New Mexico (50th). On average, blue states rank 31.58 in taxpayer ROI, while red states average 21.77.
In short, Connecticut taxpayers are paying champagne prices for boxed wine government. With the General Assembly eyeing new taxes on the wealthy and considering dismantling the state’s fiscal guardrails to make room for more spending, residents can expect more of the same: high costs, modest returns, and a government more focused on growing its budget than delivering value.
