If you’re waking up on Tax Day in Connecticut, congratulations — you live in one of the most expensive states in the country, and your money doesn’t go very far. Whether it’s property taxes, income taxes, or how the state treats businesses, Connecticut continues to prove that you can spend a lot and still get very little in return. And if you think it feels like you’re paying more and getting less, you’re right. The national rankings prove it.
Connecticut’s tax system is among the least competitive in the nation. According to the Tax Foundation’s 2025 State Business Tax Climate Index, Connecticut ranks 47th out of 50. That’s not a one-off — the state has been stuck in the bottom five since 2016. So, it isn’t a rough patch. It’s a way of life.
Ranking is based on how Connecticut performs in key tax categories:
- Individual Income Tax: 47th
- Property Tax: 50th (worst in the country)
- Unemployment Insurance Tax: 40th
- Corporate Tax: 31st
- Sales Tax: 21st
Connecticut’s tax system isn’t just uncompetitive — it’s a case study in how not to run a state.
WalletHub’s 2025 Tax Burden by State analysis focuses on tax burden — not just tax rates. While rates can vary depending on income, deductions, and life situation, tax burden measures what actually comes out of residents’ wallets. It’s the share of total personal income that people pay in state and local taxes.
The study compared all 50 states based on three major categories: property taxes, individual income taxes, and sales and excise taxes — each measured as a percentage of total personal income in the state. It found that Connecticut ranks as one of the most heavily taxed states in the country, with a total burden of 9.90%, the 10th highest in the nation. That breaks down to:
- 3.96% property tax burden 6th highest
- 3.22% income tax burden 13th highest
- 2.72% sales and excise tax burden 43rd highest
But what are residents getting in return? Not as much as you’d expect.
WalletHub’s 2024 Taxpayer Return on Investment report ranks Connecticut 37th overall — meaning residents are paying more than most and getting less in return. To figure out which states deliver the best (or worst) bang for your buck, WalletHub compares the quality of government services to the total state and local taxes paid in all 50 states.
Despite having the 8th highest tax burden, the state‘s return in terms of government services is underwhelming. While Connecticut performs well in certain areas — ranking 3rd in education and 5th in public safety — it falls short in others: 28th in health care, 25th in infrastructure, and 12th in economic performance.
In infrastructure and pollution control, the state is near the bottom at 46th. Bottom line: Connecticut taxpayers pay more than almost anyone in the country and receive a mediocre return on that investment.
If the reports don’t make it clear how expensive it is to live in Connecticut, just look at the moving trucks.
According to U-Haul’s 2024 Growth States report, Connecticut ranks 41st out of 50 for net migration, based on more than 2.5 million one-way truck, trailer, and container rentals — one of the weakest performances in the country.
“State-to-state transactions from the past year reaffirm customer tendencies that have been pronounced for some time,” said John “J.T.” Taylor, president of U-Haul International. “Migration to the Southeast and Southwest continues as families gauge their cost of living, job opportunities, quality of life and other factors that go into relocating to a new state. Out-migration remains prevalent for a number of markets across the Northeast, Midwest and West Coast — and particularly California.”
According to Heritage Foundation’s “If You Tax Them, They Will Run” report, the Constitution State lost over 21,000 residents — most of them heading to lower-tax states like Florida and Texas between April and July 2023. Connecticut ranked 14th worst in the country for net population loss during that period. While the state did pick up some transplants from New York, the outmigration trend is hard to ignore.
Additionally, IRS migration data backs up Heritage’s report: between 2021 and 2022 alone, Connecticut lost 6,467 people and over $1 billion in adjusted gross income to 40 other states. And this isn’t a new phenomenon. Since 1991, Connecticut has lost more than 548,000 people on net to other states.
Connecticut’s high cost of living and burdensome tax structure are often cited as reasons for the exodus. Remote work has only accelerated the trend by making it easier for high earners to relocate without changing jobs. Those high earners are also the ones contributing a disproportionate share of state income tax revenue. When they leave, the fiscal consequences are real.
Connecticut’s business climate hasn’t fared any better.
CNBC’s 2024 “Top States for Business” ranked Connecticut 32rd overall, with especially low scores for:
- Cost of doing business: 43rd
- Business Friendliness: 39th
- Cost of living: 34th
It’s not hard to see why employers hesitate to expand operations here — or pack up and move elsewhere.
Cato Institute’s 2024 Fiscal Policy Report Card on America’s Governors also paints a bleak picture. Gov. Ned Lamont earned a C for fiscal performance. The grades for each governor are based on their success at restraining taxes and spending since 2022.
This Tax Day, Connecticut taxpayers are once again writing checks to a state that never seems to have enough, no matter how much it already takes. Taxes here are high — not by opinion, but by every national ranking that measures them. Property taxes, income taxes, business taxes — pick a category, and Connecticut is almost always near the bottom in competitiveness and near the top in cost.
