O’Dea: Governor’s Budget Increases Taxes, Sets Economy Back

The two-year budget unveiled by Governor Dannel Malloy before a joint session of the Connecticut General Assembly strikes hardest at those he claims to be helping, State Rep. Tom O’Dea (R-125) said, noting that the governor is violating his repeatedly avowed pledge to not increase taxes, and is continuing Connecticut down a path of policies that have produced anemic economic growth.

“What we are seeing is the governor double-down on the same kinds of policies that have failed to grow our economy or bring back jobs,” said O’Dea.  “The governor said over and over again today that he wants to help the middle class and improve our economy, yet this budget does neither.”

O’Dea noted that in his last budget the governor offered about $550 million in tax breaks which were conveniently set to take effect after the 2014 election.  Now, this new budget rolls back all but $62 million of those scheduled cuts while raising $425 million in new revenue.

“I am pleased to see there is an attempt here to make a meaningful investment in our transportation infrastructure which is sorely overdue,” said O’Dea, who serves as Ranking Member of the legislature’s Transportation Committee.  “However, the governor provides no details as to how he will pay for this significant upgrade, and that is a concern.”

In addition, O’Dea says the governor’s plan increases taxes a total of $847 million over two years, and also borrows hundreds of millions more for other projects pushing increased debt down the road for future generations.

Other elements of the governor’s proposed budget:

• Lowers the sales tax rate, but eliminates exemptions including those on clothing and footwear, and lowers the threshold for the sales tax free week from $300 to $100, resulting in a net tax increase
• Flat funds municipal aid but raises more revenue from towns by forcing them to pay tens of thousands of dollars extra for resident state troopers and increasing solid waste fees
• Cements the corporate surcharge tax indefinitely, hurting the state’s employers that he referred to as the “backbone of our economy”
• Eliminates the Business Entity Tax, but offsets that cut by increasing the business registration fee required to file with the Secretary of State’s Office
• Large increases in debt service due to delayed payments in Malloy’s last budget – requiring taxpayers to foot a larger bill
• A massive increase in transportation spending without any indication as to how it will be paid for.
• Increases restrictions on tax credits corporations can claim to squeeze $350 million more out of Connecticut’s employers

“We have only just begun the budget process, and there will be an opportunity to debate all of these issues, and I look forward to using this process to try to help craft a better budget that makes fiscal sense,” said O’Dea.