Lawmakers are expected to vote Monday on the two-year, $40 billion state budget agreement that boosts taxes on businesses, authorizes keno, and increases personal income taxes on the state’s wealthiest citizens.
Democratic leaders in the General Assembly struck the budget deal with Democratic Gov. Dannel P. Malloy early Sunday morning. Rank-and-file lawmakers are expected to learn more about what’s in the package later Monday.
When lawmakers emerged from a briefing on the negotiations early Sunday morning, they said the budget maintains the current sales tax rate at 6.35 percent. A half a percent will help fund Malloy’s 30-year, $100 billion transportation initiative, while another portion will help offset the amount of revenue some towns may lose from the new uniform motor vehicle tax rate.
The budget, according to information offered by lawmakers early Sunday morning, also will include an increase in the income tax on millionaires from 6.7 percent to 6.99 percent and give the Connecticut Lottery Corporation permission to implement the game of keno.
The budget does not expand the sales tax to a number of services currently exempt from the tax, but it triples the tax on computer and data processing and maintains the 20 percent corporate surcharge that had been scheduled to expire this year.
Joe Brennan, president and CEO of the Connecticut Business and Industry Association, said Sunday that he doesn’t understand the rationale for taking a state that’s already viewed as “non-competitive” and “making it more non-competitive.”
He said that if the tax package passes, the state will become much less competitive, as highlighted by a Wall Street Journal editorial that was circulating Saturday as budget negotiations were coming to a close.
Senate Minority Leader Len Fasano, R-North Haven, said Sunday that “despite the rhetoric we have heard from the governor, Connecticut is putting a damper on potential for job growth and fiscal stability.”
The Republicans, despite their insistence, were not included in budget negotiations.
“This budget represents broken promises and a complete disregard for the warnings made very clear over the past few months,” Fasano said.
Fasano also criticized Malloy’s insistence on keeping funding for two new charter schools in the budget.
“The only promise the governor appears to have kept in this budget is whatever loyalty he pledged to the hedge fund billionaires who backed his campaign and invested significantly in the state expansion of charter schools,” Fasano said. “Governor Malloy has ignored the voice of the people, and the voice of the legislature, on protecting our public schools.”
Malloy’s spokesman Mark Bergman never returned our requests for comment on the governor’s insistence that money be included in the budget for the new charter schools.
The Finance, Revenue, and Bonding Committee will meet at 10 a.m. today to adopt the revenue numbers necessary to pass a budget.