SENATE & HOUSE REPUBLICANS UNVEIL $1.2 BILLION TAX RELIEF PLAN FOR WORKING- AND MIDDLE-CLASS FAMILIES

“I sincerely hope Democrats join Republicans in giving our constituents the much-needed relief they deserve. Connecticut residents have been overburdened by surging costs on the goods and services they need to survive. Our residents are overtaxed, their monthly budgets are blown, and immediate relief is needed to help those who need it most.” –State Representative Rick Hayes

SENATE & HOUSE REPUBLICANS UNVEIL $1.2 BILLION TAX RELIEF PLAN FOR
WORKING- AND MIDDLE-CLASS FAMILIES

Cuts the Income Tax, Sales Tax, Gas Tax and Returns Overtaxation to CT Families

HARTFORD – Connecticut Senate and House Republicans today unveiled a $1.2 billion tax relief package to help Connecticut’s working- and middle-class families.

The proposal reduces the state income tax for low- and middle-income families and individuals, reduces the state sales tax and eliminates the meals tax, extends the gas tax suspension, cuts the tax on diesel, expands property tax relief, eliminates the state’s new truck tax, accelerates the elimination of the income tax on pension and annuities, and reduces burdens on job creators.

The plan maintains a balanced budget while returning to CT residents nearly $1 billion in inflation-related windfall revenue.

“Connecticut is overtaxing its residents and the state’s inflation related windfall must be returned to Connecticut families,” said Senate Republican Leader Kevin Kelly (R-Stratford). “Connecticut’s state budget is benefitting from inflation as the state sales tax and gross receipts tax bring in new, unplanned for revenue – a result of surging prices. Meanwhile, CT residents are struggling to balance their own family budgets with no relief in sight as inflation drives up the costs of everything – from food to energy to home heating oil. As a result of inflation, CT families are being overtaxed. Instead of using that revenue to grow government, we must return it to Connecticut’s residents. Families are struggling and they need relief now.”

“This proposal offers immediate tax relief at a time when CT residents are facing the crushing burden of historic inflation. Our plan continues to invest a historic amount in paying down on the state’s unfunded liabilities, maintains a significant budget surplus, and returns the overtaxation of CT residents to families most in need,” said Senate Republican Leader Pro Tempore Paul Formica (R-East Lyme).

“It’s time for Democrats to meet the moment,” said Representative Vincent Candelora (R-North Branford). “The cost of living here is unsustainable for their constituents, and the main street businesses that drive our economy face a punishing tax increase that threatens their ability to reinvest, grow, and create jobs. While our plan crucially provides residents with a bit of breathing room from the financial pressures squeezing them right now, its dual focus on bigger picture goals, such as cutting the income tax rate, also provides a foundation for the type of economic and personal income growth that’s long overdue in Connecticut. This is what our constituents desperately want, and in the coming days I hope our colleagues across the aisle will finally show a willingness to deviate from the priorities they set at the start of session and join us in enacting broad tax relief.”

$1.2 Billion in Tax Relief

 The CT Republican plan will:

• Cut the income tax from 5% to 4% for individuals earning less than $75,000 and joint filers earning less than $175,000 annually.
• Reduce the sales tax and eliminate the 1% meals tax through the end of the year.
• Extend the gas tax suspension, scheduled to expire at the end of June, to the end of the year.
• Expand the gas tax holiday to diesel.
• Eliminate the highway use tax, a mileage tax on trucks that will increase the price of food and products transported by truck.
• Eliminate the income tax on pension and annuities immediately.
• Expand eligibility for the state’s property tax credit.
• Reduce new tax burdens on job creators by helping to pay back the state’s federal loan to support the state’s unemployment trust fund, removing barriers to job creation.

Connecticut Republicans are pushing back against Governor Ned Lamont’s view that Connecticut is limited in providing tax relief by the federal American Rescue Plan Act. At least three district courts disagree with the Governor’s view and at least 18 other states have challenged President Biden’s unconstitutional overreach on a state’s tax cutting ability. Their success in the courts has allowed these states to provide significant bipartisan tax relief to their residents with Republican and Democratic governors signing income tax cuts into law.

Assuming the Department of Justice appeals the Texas court decision to the Fifth Circuit, Senator Kelly and Representative Candelora announced that they intend to file an amicus brief supporting the arguments made by other state’s challenging the tax relief restrictions contained in the American Rescue Plan Act. They previously sought support from Governor Ned Lamont, Attorney General William Tong, and Democratic members of the General Assembly in this challenge. Thus far, CT Democrats have refused to join in efforts to challenge the White House to provide further tax relief to Connecticut residents.