June 5, 2019

Zupkus Dismayed by Massive Tax Proposal, Plan to Raid the Transportation Fund

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HARTFORD- State Rep. Lezlye Zupkus (R-89) strongly opposed a state budget that ignored the voices of working families and small businesses in Connecticut by increasing their taxes making it more difficult to live, raise a family and do business in Connecticut.

This plan will now tax parking garages, the Internet, dry cleaners, restaurants, plastic bags and scores of other goods and services will all cost Connecticut consumers more beginning July 1 due to sales tax hikes. Thousands of business owners operating as LLCs will pay an estimated $50 million more in income taxes under the Pass through Entity tax because of the scheme hatched by the majority in order to close an estimated $3 billion deficit over the next two years that is of their making.

The budget proposal included a diversion of $171 million over the next two years in new car sales revenue from the Special Transportation Fund to the General Fund, effectively intentionally starving the fund as to make the governor’s case for tolls this summer.

In 2018, voters overwhelmingly ratified an amendment to the state Constitution added a new legal “lockbox” to safeguard funds earmarked for Connecticut’s transportation program to balance the state budget.

The budget passed without a single Republican vote. Overall, taxes were raised by $1.75 Billion over the next two years.

“I must say, I’m quite disappointed. I could not support such a tax heavy budget,” said Rep. Zupkus. “There are new taxes expand the sales tax, tax meals from grocery stores and restaurants, and also punish mom and pop businesses throughout the state with new burdensome taxes. Furthermore, the plan includes a new surprise tax on soda, beverages or liquor dispensed at bars or soda fountains.”

This budget reflects no fiscal restraint, and in fact includes more state borrowing and no major spending reductions. In fact, when compared to our state’s poor fiscal health, this budget implements lavish new initiatives that Connecticut taxpayers just can’t afford:

• Paid Family and Medical Leave: $5.2 million for paid FMLA. Cap at Social Security, a new 0.5% payroll tax. Annual payroll tax revenue is roughly $400 million. The annual cost to operate the program is $20 million. State Staffing (union employees) will only grow.

• $15 minimum wage: Grows salary-related state budget costs.

Zupkus and the House Republicans offered a series of amendments to reduce government spending, shrink the bloated bureaucracy, privatize certain state agencies, preserve funding for the Special Transportation Fund and keep intact pension exemptions for seniors, as well as send more money for towns and cities. Municipalities would get an additional 5 percent in funding in the second year of the budget.

“These careless policies have a cumulative effect on our state’s economy. Many businesses may be forced to raise their prices, decrease their workforce or close their doors, ultimately the residents of Connecticut will feel the financial pain,” said Rep. Zupkus.