STRATFORD—Republican gubernatorial candidate John McKinney released a plan Thursday to eliminate the state income tax for residents earning less than $75,000 beginning in 2017.
McKinney, the state senate minority leader, is competing for the Republican nomination against Tom Foley, the party’s convention-endorsed candidate. Republican voters will go to the polls on Aug. 12 to pick a candidate. Whichever wins will face incumbent Gov. Dannel P. Malloy.
“We believe middle class people across Connecticut have paid too much in taxes and they deserve their money back,” McKinney said at a press conference outside a plaza in Stratford.
According to McKinney and his lieutenant governor running mate, David Walker, their proposal will end the state income tax for about 1 million residents, which will reduce state revenues by about $746 million.
McKinney has proposed to make controversial cuts in order to pay for the tax cut and close the $1.4 billion deficit, projected in next year’s budget. Those cuts include ending the state Earned Income Tax Credit, a $120 million a year program that sends money back to the working poor, who don’t necessarily pay income taxes.
“We’re trying to provide income tax relief for people who are paying income taxes. The bottom line is, they bore the brunt of the largest tax increase in state history,” McKinney said
The plan calls for labor concessions from state employee unions. That means restructuring their health benefits and requiring more worker contribution toward their pension benefits. The plan would reduce the number of state employees in management positions who are not unionized.
“There are how many deputy wardens in our prison system that hard-working correction offices don’t know what they do?” he asked. “By making the management levels efficient and trim, we project we can save about $120 million in the first year of the budget.”
Walker, a former U.S comptroller general, said Connecticut’s financial condition is “much worse than advertised” and the size of state government must be reduced.
“You can not achieve tax relief in this state without real spending reductions,” he said.
Foley has previously proposed to cut cut the sales tax by one-half of 1 percent. In a press release, his spokesman Chris Cooper said that proposal would benefit more Connecticut residents than McKinney’s “narrowly focused” income tax elimination.
“John McKinney is coming to the party very late. Tom Foley will provide broader-based tax relief than John McKinney is proposing including reducing the sales tax which benefits all Connecticut residents,” Cooper said.
McKinney said Foley lacks a plan to achieve the sales tax cut he mentioned. He said Foley has been unwilling to provide specific details on many of his proposals.
“All I’ve heard, to be fair to [Foley], is that because of his business experience, he can just simply make things grow less and somehow, without touching state employee health care, without touching Medicaid, he’s going to get lower spending and health care. Those are empty, vague promises. Let’s see his plan,” McKinney said.
In a statement, state Democratic Party spokesman Devon Puglia said McKinney’s plan would reverse progress Connecticut has made during Malloy’s first term.
Puglia said tax relief is important “but not at the expense of our schools, our roads and infrastructure, and elimination of other vital services. John McKinney has proposed slashing the Earned Income Tax Credit for low income residents, rental rebates for seniors, gutting money for schools, pulling the plug on health care, and laying off droves of employees. Under his latest plan, the cuts would be even deeper.”