HARTFORD, CT — The Finance, Revenue, and Bonding Committee will hold a public hearing on several tax increases Tuesday. And after a day of speculation about whether they could pull it off, the Appropriations Committee has scheduled a vote on a spending package.
The Appropriations Committee is expected to meet behind closed doors Tuesday morning to discuss their spending proposal, which will look different than the one Gov. Dannel P. Malloy presented in February. However, it was still unclear late Monday exactly how they will eliminate Malloy’s proposal to change how teacher pensions are funded and change how education aid is distributed to cities and towns. It’s also unclear exactly how much revenue their proposal would need to raise in order to balance.
Meanwhile, two top Republicans called on Democratic lawmakers to cancel a public hearing on proposals to raise taxes.
Sen. Scott Frantz, R-Greenwich, who co-chairs the Finance, Revenue, and Bonding Committee and Senate Republican President Len Fasano, R-North Haven, wrote Rep. Jason Rojas, D-East Hartford and Sen. John Fonfara, D-Hartford, Monday night asking them “not to take up multiple tax increase proposals.”
The Finance, Revenue, and Bonding Committee will hold a public hearing today on 11 bills, including one that would increase the sales tax from 6.35 percent to 6.99 percent, one that would increase the top marginal tax rate on top income earners from 6.99 percent to 7.49 percent and another that would give municipalities an opportunity to impose a local option sales tax.
On Monday night, Rojas said that mayors and first selectmen have been asking for lawmakers to have a conversation about giving them the option to look at raising more money through the sales tax.
He said these are the same Republicans who have been critical in the past of including revenue options in budgets that haven’t had a public hearing. He said this gives the public a chance to weigh in on all of the revenue options they may need in the next month to help balance the state budget.
He dismissed the 11th hour proposal as political posturing.
“Just hearing these bills is detrimental to our state and sends a message to businesses and families about the direction our state is headed,” Frantz and Fasano wrote. “Even if we don’t go down that road, having a hearing on these tax increases sends the wrong message that such taxes are not out of the realm of possibility, resulting in people leaving our state and further accelerating the problems facing our state.”
Republicans and Democrats have been arguing for more than a year about whether the two largest tax increases in the state’s history over the last six years have caused businesses and residents to pack up and move out of Connecticut.
Connecticut is losing about 575 residents per week to other states, according to 2016 U.S. Census data. Between July 1, 2015, and July 1, 2016, Connecticut’s total resident population fell by 8,278 people.
But there is still a dispute about whether the tax increases are really what’s driving them out. Democrats have argued that residents are leaving for a lot of reasons, including reaching retirement age.
Frantz and Fasano said the theory behind the tax increase was the additional “revenue would help the state get out from under and move past its economic slump and budget uncertainties. Unfortunately, the opposite has occurred.”
They said the fear of higher taxes and more taxation will only push more people out of Connecticut.
Rojas said the public still deserves a chance to have that conversation.
Whether the committee, where Democrats only hold a one-seat majority over Republicans, will be able to muster the votes for any tax increase remains to be seen.
“We are still working with our members to reach consensus,” Rojas said Monday.
The committee’s deadline to approve a revenue package is Friday.