Lamont, CT Democrats Propose $500 Million Tax Cut Package

CONNECTICUT — Gov. Ned Lamont and legislative Democratic leaders announced a $500 million tax cut package as part of the state budget adjustment. The adjustments will have to be voted on by the state legislature.

The budget adjustment is a 2.5 percent increase over the budget passed last year. Lamont had proposed some initiatives earlier in the legislative session, including the property tax credit, motor vehicle mill rate cap and exemption of pensions and similar retirement income from state income tax.

House Speaker Matt Ritter (D-Hartford) said the budget adjustments are fiscally prudent investments in the state’s future.

“The governor's leadership from day one has been about that,” Ritter said during a news conference. “And I think we've all bought into that argument. Democrats can run a state and run a government prudently and wisely, investing in middle class families.”

House Minority Leader Vincent Candelora (R-Branford) said the changes provide little in permanent tax relief for Connecticut families.

“I think we could have done more to provide broad, immediate and even structural tax relief such as an income tax reduction, but Democrats chose to go it alone and ignore our concepts that would have a more substantial impact on our economy and household budgets,” he said.

Below is a summary of some Democratic tax cut proposals:

Gas tax suspension extension
The deal calls for a continued suspension of the 25-cent gas tax through Dec. 1. The tax is currently suspended until June 30.

Child tax credit

The budget proposal includes a one-year $250 per-child tax credit for up to three children per family.

There is an income eligibility cap of $100,000 for individual filers and $200,000 for couples filing jointly.

About 600,000 Connecticut children will benefit from the credit, Rep. Sean Scanlon said. The program will cost the state about $125 million.

Property tax credit

The state property tax credit would increase from $200 to $300. The property tax credit could only be claimed by filers with children or seniors, but those requirements will be lifted.

Car tax cap

The proposal calls for lowering the car mill rate cap from 45 mills to 32.46 mills. Municipalities who are over 32.46 mills would be reimbursed by the state.

The change will cost the state about $100 million.

Pension tax

Lamont earlier in the year proposed excluding pension and annuity income from the state income tax. The proposal made it into the package.