Living In Connecticut To Get More Expensive

Gov. Malloy Proposes Stiff Tax Hikes Across The Board

HARTFORD, CT (AP / WCBS 880 / CBS 2) – Nearly every Connecticut resident will pay more in taxes under the budget being proposed this week by Gov. Dannel P. Malloy.

WCBS 880 Connecticut Bureau Chief Fran Schneidau with a budget previewWCBS 880’s Paul Murnane with reaction in Rowayton

WCBS 880 Connecticut Bureau Chief Fran Schneidau on whether a higher gas tax will make the state less competitive

The new Democratic governor will propose raising taxes on everything from personal income to cigarettes, alcohol and gasoline, according to details of the tax plan released Monday by his top advisers.

Besides increasing the sales tax rate, from 6 percent to 6.25 percent – 6.35 percent for retail purchases – Malloy wants to put an end to a laundry list of goods and services that are currently exempt from the sales tax. Under Malloy’s plan, clothing and footwear under $50, pet grooming services, boat services, manicure and pedicure services, yoga studios, cosmetic surgery, non-prescription drugs, limousine services, airport valet services and haircuts would be taxed.

The proposal also ends the popular sales-tax-free week, which is typically held in early fall when families are buying school clothes, as well as the property tax credit – a maximum of $500 – against the personal income tax.

“Everybody has been asked to do a little bit more,” said Malloy’s senior adviser, Roy Occhiogrosso. “That’s the only way you can avoid asking one group of people to do too much.”

Occhiogrosso said the new tax rates still maintain the state’s competitive edge with other states and are done in the fairest way possible.

“(Malloy) believes people are willing to make sacrifices if they understand why,” Occhiogrosso said.

That’s not what CBS 2’s Lou Young found out when he went to Connecticut on Tuesday.

“I’m not happy at all. I’m ready to move to New Hampshire and give it all up,” said Victoria Maybek of Newtown told Young.

Malloy is calling it shared sacrifice, but one Bridgeport barber wasn’t in the mood to hear it.

“Shared sacrifice? How much more are we supposed to sacrifice? Tell him to sacrifice some of his pay!” Freddie Ortiz said.

One Greenwich doctor had a different prescription.

“Spend less! It’s simple, spend less!” Dr. Henry Gasiorowski said.

Malloy is scheduled to address a joint session of the General Assembly on Wednesday. That’s when he will present his new budget. It comes at a time when the new fiscal year, beginning July 1, is predicted to be anywhere from $3.2 billion to $3.5 billion in deficit, which is approximately 18 percent of current spending.

Budget director Benjamin Barnes said Malloy’s two-year budget increases revenue by $1.5 billion in the first year. Details of the spending side of the budget have not been revealed, but Occhiogrosso said the cuts add up to about $2 billion. He said the new budget also includes proposed savings from state employees and agency consolidations.

The agency consolidations, however, are expected to save about $10 million in the short-term. That figure does not include savings from proposed higher-education mergers.

There was little excitement in Hartford for the tax package. Chris Healy, chairman of the state Republicans, said Malloy’s attempt to close the budget deficit “by relying on the largest tax increase in Connecticut history is a failure of vision and leadership at a critical time,” and he said the plan would be a disaster for the middle class, small business owners and investors but “a pay day” for the government.

“At long last, we see what many privately feared, that Governor Malloy is more interested in rewarding those who feed off government rather than those who produce wealth and opportunity,” Healy said.

Senate President Donald Williams, D-Brooklyn, issued a noncommittal response.

“We respect the difficult challenge facing Governor Malloy, and we stand ready to work with him to pass a budget that is tough, fair and helps Connecticut grow jobs,” he said.

The new governor’s tax plan is far-reaching, affecting a litany of taxes including the income, sales and use, corporation, admissions, oil companies, insurance companies, estate, alcoholic beverages and cigarette taxes. Any budget will ultimately have to be approved by the Democratic-controlled General Assembly.

Malloy has proposed eight income tax rates, ranging from 3 percent for joint filers earning up to $20,000 a year to 6.7 percent for joint filers earning $1 million. Occhiogrosso said qualified lower-income earners will be able to offset some of the tax increases by participating in a new earned income tax credit Malloy has proposed. All the income tax increases would be retroactive to Jan. 1.

The plan also includes two sales tax rates: 6.25 percent and 6.35 percent. Barnes said the higher rate would apply to retail purchases. The additional one-tenth of 1 percent will be collected in a new fund that will help cities and towns. Barnes estimated it would raise $24 million.

Malloy’s budget calls for increasing Connecticut’s gasoline excise tax – already among the highest in the nation – to climb from 25 cents per gallon to 28 cents. The diesel tax will climb from 26 cents per gallon to 28 cents. It also raises various motor vehicle fees.

There also is a proposal to require companies that earn income in states with no corporate income tax, such as Nevada, to pay corporate income taxes in Connecticut on that income. While that idea isn’t likely to be embraced by businesses, Barnes said there will be other proposals in the budget that are considered more pro-business, such as increasing the tax credit cap for companies that create jobs.

The plan continues a 10 percent surcharge on the corporation tax for two more years.

(TM and Copyright 2011 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2011 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)



  • JRinCT

    Hey Malloy… I’ll send my taxes to you in cash… that way I can wipe my a$$ with every single dollar I pay you to mismanage our “Government”…

  • Mike

    How about dealing with the excessive government employee health care and pension benefits before putting your grubby government hands in the tax payers’ pockets? It’s easy to raise taxes…and very difficult to govern by making the hard decisions. By not fixing the real problems in excessive spending, the budget will only continue to get worse requiring more tax increases. This is a great way to chase away business and residents to other more tax friendly states. Corruption and favoritism begets corruption and favoritism…… Florida here I come.!

  • John Zyrlis

    This tax thing sucks totally – we’d be better off and have more money in our pockets if we were able to keep all the tax money and give the State the rest. I thought we broke from England with the call for “no taxation without representation”. All we have now is taxation WITH representation – maybe we should go back to joining England again.

  • Pete

    What did you all expect Maloy’s record was clear in Stamford TAX TAX TAX
    He says that CT is open for business but means OPEN FOR BUSINESS OPERATIONS TO LEAVE!!

  • BillYBoy

    Government workers are special, they work extra hard and deserve everything they get. If money is tight we simply must find extra cash to keep them employed and to fund all of their retirement and pension plans. They are not like us, they deserve every penny.

  • Cris

    My pension states that I get a weeks pay for every year that I work. That’s fair. I have to rely on myself for anything beyond that which is also fair. I’m a big girl I should be able to take care of my own finances. So why is it that state workers get pensions for life? REALLY!!! What makes them any better than the rest of us? Yeah, I know all the state workers are gonna chastise this comment, but you know just as well as I do, there are plenty of people out there who work a heck of a lot harder than you and don’t get all the “perks”. That should be the first thing to go.

  • Eric

    The Tax Man Dan…. Listen to the people…. Our State Goverment is to large simple answer is to cut spending….. Don’t raise taxes on the last few jobs we have left in the state….

  • Maryanne

    I can’t believe people are so incensed about an increase in taxes like this. If I buy something for $100 – I now would have to pay 35 cents more in tax than before? I’ll do my part as long as we really do have “shared sacrifice” and the wealthy are doing theirs. Taxes are what we pay to live in this community and for the common good. As long as corporations and the wealthy pitch in – the state can have my additional .35% on sales. We still have a lower sales tax than many states.

    • Karen

      The wealthy are doing theirs? You must think we who are not rich are a bunch of ignorant slobs to swallow that one!

  • Tom

    Why did the people of Ct. think that a Liberal Democratic Mayor who has a history of raising taxes as a mayor wouldn’t raise taxes for the WHOLE state of Ct. when he was elected Governor? What was everybody thinking, getting more of a free ride from the government because that is what they are used to getting from Liberals and Democrats? The liberal voting in this state has got to STOP as all these years of electing these types of people are KILLING the state! The color of Blue has GOT to go or everybody will be moving to Florida! You should have known that this would happen, so why are you acting so surprised?

    • PW

      I live in Stamford, I saw what he did to Stamford, my taxes raised beyond belief while he lived in his nice house by the water and I struggled to feed my family and pay my mortgage…now the whole state has to deal wtih him…it’s disgusting. it really is. Thanks Malloy…for nothing

  • thomas

    what a sleeze- just watching this guy on morning joe makes me vomit-fast talking sleezeball-glad i am in florida


    Wisconsin has the right idea. The deficit was created by the unions and the unions should pay for it – ALL OF IT!!

  • Ed

    You guys voted this guy in

    • John Zyrlis

      Not me

    • PW

      Not me either

  • John

    where do the tax increases end ? When does the spending stop ? I think its time to move out of this state..This state is a joke and the people who run it

  • Bruce

    It is time for the people of CT. to demand accountability of their governing body. We need to have an annual independent audit of our state and city government to see where the already exorbitant taxes are going. Increased taxes are not the answer. Increasing taxes is like pouring water into a bucket with a hole in it. Until the hole is fixed there is no amount of water that will fill the bucket.

  • joseph a. fabrizi

    Att: Govenor Malloy: All pensions are retirment money and should be tax free from the state income tax. Some state make the public employee pension tax free while other states give a percent tax free from the state income tax. Connecticut only chases the retiree pension person out of the state. Look at all the good if the retiree can reside in the state. The time has come for connecticut to join other states in this noble cause for the retirees.

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