Barring another extension of Gov. Ned Lamont’s executive order, Connecticut’s 10 cent tax on single-use plastic grocery bags will return on Wednesday, July 1. Lamont initially suspended the plastic bag tax until May 15 in response to concerns that reusable shopping bags might put grocery store workers at risk of ...
Tax On Low-Wage Jobs: Fewer Jobs, Higher Prices
It’s zero. That’s what people earn when they don’t have a job.
jobs in this state, at the same time increasing the cost of selling essential items like food, clothing, and
diapers. They would also encourage businesses to speed up automation of low-paying jobs.
every employee who earns less than $15 an hour. One bill calls for taxes on businesses with more than
250 employees, the other on businesses with more than 500 employees.
and the leisure and hospitality industries, because these industries have the most workers who earn the
minimum wage or near the minimum wage.
“owe” the government money because these employees may rely on government services.
for a family – is flawed. Many minimum-wage employees do not rely on the government for services
because their total household income exceeds the threshold. In addition, punishing employers for
offering jobs that follow all of the state’s labor laws would be an astonishing precedent – and one that
would be extremely damaging to the state’s economy.
backfire when a partial subsidy becomes a 100 percent subsidy after employees start losing their
while businesses will be the ones writing checks to the state, it is the consumers who will ultimately pay
for these taxes through higher prices on items like milk, socks, and sandwiches. These higher costs will
hurt every consumer in Connecticut, but they will hurt the poorest residents– the people who these bills
supposedly help – most of all.
their wages increase because of this legislation. Employers will find it’s cheaper to pay the tax instead of
increasing their employees’ pay – but as the cost of goods and services go up, the poor are the least able
to absorb these higher costs.
percent profit margin in 2014.
wage, but because they are publicly funded they will not be taxed under these bills. For example, UConn
pays some of its employees the current minimum wage, according to job postings. Cities and towns also
pay many employees the minimum wage, including lifeguards and after school childcare providers.
workers who earn minimum wage from private companies are also attending school. Lots of families
collect a second income through part-time work in the retail or hospitality industries. Why single them
and their employers out for a penalty?
of a single group has broad implications in both contract and constitutional law and could lead to time- consuming, expensive – or even successful – challenges in court.
like Seattle, Oakland, and San Francisco – will eventually raise the minimum wage to $15 an hour, none
are there yet. But all three cities have already started raising their minimum wages gradually, with plans
to reach $15 an hour by 2018. As hourly wages increase, the cities are seeing some predictable results.
minimum wage was increased, the Salvation Army struggled to maintain its childcare services as wages
and costs went up. Also in Oakland, many businesses in the city’s Chinatown struggle to remain open.
required – or even intended – to support entire families over the long term. But in a growing economy,
unburdened by excessive taxes and regulations, minimum wage jobs most often are entry-level
positions for young, inexperienced workers, and can provide the starting-off point for their future
careers. Others work at minimum wage jobs part-time, to supplement a family’s household income.
toehold on the ladder of opportunity for young people, immigrants, or others new to – or re-entering –
the work force.
available as the minimum wage goes up. Two professors from University of California San Diego released
a peer-reviewed study in November affirming what other researchers have been saying for years – as
the minimum wage increases, the number of jobs falls. Depending on the strength of the larger U.S. job market, Connecticut may still see job growth in the sectors most affected by this legislation. However, if these bills are passed, Connecticut would likely lag behind where it would have otherwise been in job growth.
automate jobs. How long will it be before we see iPads at dining room tables instead of servers? Or self checkout kiosks at McDonald’s drive-thru windows?
effort to partly replace cashiers – a sign of things to come in Connecticut if labor costs keep rising.
work to create a state business climate that is conducive to the creation of more jobs. It makes more
sense to provide education and training that will prepare low-income employees to advance their
give employees at every level on the pay scale greater mobility. These two bills will only further
exacerbate Connecticut’s economic troubles.
– Affects employers or franchisors with at least 250 employees.
– Does not affect private nonprofit or public entities.
– Money from this bill would go into the General Fund.
– It would be under direction of the Labor Commissioner.
– The bill says employers cannot reduce employees’ work hours to avoid paying a fine.
– It says employers cannot fire employees to avoid paying a fine.
– The state expects to collect $342 million annually.
– Will cost $20 million for increased Department of Labor staff to regulate and police the
– Will affect 164,400 of the 832,886 employees estimated to work for firms with at least 250
– Will cost $ $19 million for increased Department of Labor staff to regulate and police the
– Private nonprofits and state institutions are exempted.
– Creates a Connecticut Low Wage Employer Advisory Board with 13 members, whose job
would be to report to Department of Labor on linkages between low-wage jobs and social
– The money raised by this bill goes directly to the Departments of Social Services and
Development Services and the Office of Early Childhood
– Affects 146,710 employees.
– Exempts employees at parks/camps open less than 6 months a year.
Occupational Therapy Aides
Farm, fish and forestry occupations
Personal Care Attendants
Home Health Aides
Office and Administrative Support Staff
Personal Care Aides
Maids and Housekeepers
Food Preparation and Servers
Parking Lot Attendants
Hotel Desk Clerks
The Connecticut Department of Revenue Services paid more than $12 million in interest for tax refunds totaling nearly $5 million because they withheld those refunds for upwards of seven years, according to a new audit. The audit listed tax refunds from years 2014 through 2018 and found that late returns ...