Boucher: “Insanity is the doing the same thing over and over and expecting a different result.”
Report by Paula Antolini
June 4, 2015 7:21PM EDT
Highest Retroactive Tax Increase in History is followed by the Second Highest Tax Increase
Governor Malloy Breaks His No Tax Promise – State Budget Full of New Taxes
Sen. Toni Boucher: Ranking member of the Transportation and Education Committees and a member of the Finance and Judiciary Committees
Hartford, CT – State Senator Toni Boucher (R-Wilton) released the following statement re: proposed state budget for FY 2016 – FY 2017 as negotiated by the democratic legislative leaders and Governor Dannel Malloy.
“Insanity is the doing the same thing over and over and expecting a different result.” In 2011, the Governor proposed and signed the largest retroactive tax increase in the history of the state that resulted in continual deficits and with more people and jobs leaving the state.
“After another all-nighter in the Hartford, I pulled into my driveway at 5:30 am this morning and dragged myself into bed only to be awoken by a request for a radio interview. They wanted to know what was happening in Hartford. The Governor and majority’s democratic budget has taxpayers crying foul and GE, Aetna and Travelers – big companies are all threatening to leave the state.
“I told the radio host we provided a detailed alternative budget that does not increase taxes but once again, the Governor will not reach across the aisle. It’s his way or the highway. That has been the typical answer.
“Too many are choosing the highway. In the final days of this session an uprising seems to be taking shape. The state cannot continue on this path, it simply cannot! It hurts to see the state that I love change so drastically, but often things have to get really bad before people demand a course correction. I pray this is one of those times.
“Connecticut’s unemployment rate is now higher than the national average and the other New England states. A Wall Street Journal article recently reported that the states’ financial condition, unfunded liabilities, tax burden and business reputation are all much worse than Illinois. The state economy is stagnant. It grew .9% in 2013 (10th worst in the United States) and only .42% in the last four years according to the federal Bureau of Economics.
“The last few days of the 2015 session the Governor and majority leaders made a deal and rolled out a budget agreement that targets the middle class, job creators, top wage earners and both big and small businesses. But government and state unions were not asked to join in sharing the sacrifice.
“A campaign promise was made last year by the Governor to not raise taxes. That’s also what he said in 2010 when the theme of “shared sacrifice” was central to his budget message. During his time in office, the Governor has signed a $2.6 billion tax hike – the largest in state history – promising that it would eliminate a budget deficit. Now, he is poised to sign yet another significant tax hike – $2 billion because shared sacrifice wasn’t enough. Sadly, this budget does not change Connecticut’s bad spending habit, but rather continues to enable it with a more than 7% increase in spending.
“Here is how this $40 billion budget will impact middle income families, businesses and veterans:
- Reduces the Property Tax Credit from $300 to $200 impacting many individuals who own a home or a car. Totals a $152 million money grab by the state. 81% of those who utilize the tax credit have annual incomes less than $100,000; 66% have annual incomes less than $75,000; 44% have annual incomes less than $50,000.
- Repeals the scheduled sales tax exemption for clothing/footwear under $50 and reduces the sales tax holiday from applying only to items under $100 instead of $300. Represents a $280 million tax hike.
- Implements a 3% sales tax on the World Wide Web (including digital downloads and ebooks), a new $55 million tax.
- Implements a sales tax on car washes, a new tax totaling $13.6 million.
- Increases a luxury sales tax rate on engagement rings, wedding dresses and cars to 7.75% totaling more than $4 million.
- Delays the scheduled increase in the Personal Exemption for Single Filers. According to the Department of Revenue Services Personal Income Tax Study of January 2014, 90% of single filers had $75,000 or less of state income. Totals a tax increase of $10.8 million in FY 2016.
- Reduces the burial benefit provided to indigent people by $400 giving their loved ones $1,400 to pay for a funeral.
- Takes away funding for the Veterans honor guard which means no gun salute at a military service members funeral
- Implements a sales tax on motor vehicle parking, a new tax totaling $12.2 million.
- Taxes ambulatory surgical centers. A $35 million new tax.
- Increases the Hospital Tax. A $410 million increase in taxes. Added costs will be passed onto patients.
- Triples the Computer Data & Processing sales tax rate, a tax hike of over $140 million.
- A $500 million tax hike on businesses, which will make it difficult for employers to grow jobs and remain competitive.
“Jobs affect every single family in our state from all walks of life. What are Connecticut’s largest employers saying about Gov. Malloy and Connecticut Democrats’ plan to raise our taxes yet again?
Boehringer Ingelheim Pharmaceuticals, Inc. employs more than 47,000 worldwide said this:
- “Implementing the current, short-sighted tax proposals will stifle innovation, especially research and development of critical medicines, and have far-reaching implications on our ability to plan and make long-term business decisions. The current proposal will undermine the financial feasibility of continued capital investments at our Ridgefield/Danbury site.”
Aetna, which employs 7,450, had this to say:
- “Connecticut is in danger of damaging its economic future by failing to address its budget obligation in a responsible way. Such action will result in Aetna looking to reconsider the viability of continuing major operations in the state.”
General Electric, which employs 6,300, said this:
- “Reports that Connecticut officials intend to raise taxes by another $750 million are truly discouraging. Retroactively raising taxes again on Connecticut’s residents, businesses and services make businesses, including its own, and citizens seriously consider whether it makes any sense to continue to be located in this state.”
“The company noted that the Connecticut economy continues to struggle as other states offer more opportunities and a better environment for business growth.”
Travelers which employs 6,200 people, said the following:
- “Raising taxes again will increase the cost of living for nearly every resident and small business in the state, negatively impacting our employees and customers.”
“I along with my fellow Republican legislators applaud these large employers for speaking out. Adding insult to injury the budget violates the spending cap put in place back in the 90’s when Connecticut sadly instituted the income tax, a tax, I would maintain was the beginning of the end to Connecticut’s competitiveness. A course correction must be made.
“The alternative to taxing people and businesses more is to ask our state unions for the $300 million in savings they agreed too. They have yet to deliver on that promise of shared sacrifice. In addition the state could use $400 million in prioritizing current bonding capacity for transportation infrastructure projects to avoid new taxes. These are only two examples of the many proposals we have provided.
“Coming to America so many years ago, I hardly recognize the state that my family with my brother and I emigrated to from Italy now. Connecticut was once a state filled with opportunity. It had very low taxes, top in the nation educational system and a wonderful quality of life.
“At the time of our arrival to Connecticut, we were limited by poverty and illiteracy but not by Connecticut’s economy or lack of opportunity. I may have grown up in a minimum wage home but the state was the Insurance capitol, the brass capital, the rubber capital, defense capitol of the world.
“The captains of industry provided my father with a factory floor job, me with my first toy and my junior achievement club with money to run our high school company, my local retailer with customers who graciously paid for scholarship money to fund my foreign exchange trip to Argentina.
“The ripple effect of the businesses community contributions can be profound. Our large corporate donors give millions to Americares, Girls and Boys Club, YMCA’s, UCONN, Big Brothers and Big Sisters and community college foundations.
“UCONN tells me when their donors move to Florida they take their contributions with them and they are hard to get back. This budget with further erode the ability of these philanthropists to give to our states nonprofits and the needy people who are the beneficiaries of their generosity.
“Other states led by democrats seem to be able to manage their finances. Why not CT? Swallow your pride, and let’s do right by the people of Connecticut. We can still pull the budget out of the fire before everyone gets burned.
“I have heard from hundreds of constituents: Toni don’t let this happen! I can’t afford to live here anymore, I feel duped, and this Governor lied to me. You have made phone calls, wrote letters to the editor, got on social media – but sadly the current leadership of the state has turned its back on residents and some of the largest most prestigious employers.
“Lastly, a widow from my district wrote this message: ‘Do the members of the Democratic Party sitting on the Finance Committee make so much money they feel increasing taxes is painless for them and therefore the same should hold true for everyone else? Or are they exempt from paying taxes through some magic formula therefore they can slap increases on everyone else without any effect on their own pockets? As a widow on fixed income I can tell you that while I can be generous to a fault I regret every penny extracted from my income over and above a fair share because we have an administration intent on playing father bountiful to those who take everything and can give nothing back. Enough! If I could drive on improved roads and over safer bridges, see better results in services that would be a good thing. But for all I am taxed I see a degrading infrastructure, increasing salaries to an every segment of a burgeoning state government – I should have had a job as a state employee and had the comfort of knowing I would be supported for the rest of my life. The citizens of Connecticut cannot withstand more taxes. Bring in business by lowering the corporate rate, create jobs for those who will then add to the tax rolls. Please, stop driving nails into the coffin that is Connecticut and either bury us once and for all or get out of the way and let us grow and improve. You have killed the golden goose and are now you are now intent on plucking away every remaining feather.’
“The Governor and the majority party may be ignoring the will of the people to their peril. I have a strong sense that a day of reckoning is coming.”
*****
State Senator Toni Boucher
Legislative Office Building
Room 3400
Hartford, CT 06106
1-800-842-1421
The 26th District is comprised of:
Bethel, New Canaan, Redding, Ridgefield, Weston, Westport, Wilton
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