Coalition of Connecticut labor, advocacy groups seeks higher income taxes on wealthy, not cuts

Economic Indicators Associated Press

The persistent battle over Connecticut's budget continued Thursday as a coalition of labor unions and social service advocates urged state lawmakers to increase income taxes on the wealthy rather than impose eleventh-hour spending cuts on a budget they argue is already bare bones.

Continue Reading Below

Representatives of Better Choices for Connecticut called for an additional half of 1 percent increase on individuals earning more than $500,000 a year or couples earning more than $1 million a year. The two-year, $40.3 billion Democratic budget already raises the top marginal rate by a half a percent to 6.99 percent.

The advocates contend a higher tax on the wealthy would be fairer than imposing additional spending cuts to cover the $224 million in business tax increases that Gov. Dannel P. Malloy wants to roll back. The Democrat offered his tax roll-back proposal Friday following an outcry from some of the state's major employers, a couple of which had threatened to move out of state.

"This budget already made hard choices, already asked a lot from families that can barely afford it," said Roger Senserrich, policy director for the Connecticut Association of Human Services. "It's time that those that can afford it, those that make the most money in the state pay a bit more."

The Democratic controlled General Assembly passed a two-year, $40.3 billion budget on June 3. However, Malloy has not yet signed the plan into law and has asked lawmakers to grant him the authority to cut more spending across the board by 1.5 percent or make the cuts themselves that are needed to scale back the business tax increases.

Legislators are expected to return to the Capitol, possibly on June 29 and 30, to vote on some budget-related bills and other unfinished legislation. After struggling to pass the Democratic budget by a slim margin in both the House and Senate, they find themselves in the middle of an extra-innings debate over whether the budget cuts too much or taxes too much.

Continue Reading Below

Each day, a different group raises concerns about the package, seeking last-minute changes.

Republican Senate leaders have called on the majority Democrats to reopen the budget entirely, pointing to Wednesday's announcement that Hartford HealthCare planned to eliminate 335 positions.

"Adding more taxes to our hospitals and reducing Medicaid reimbursements by the levels in this budget is clearly a dangerous mix. The state needs to scrap this hospital plan so that lawmakers can come together with a new approach," read a joint statement from Senate Minority Leader Len Fasano and Sen. Kevin Witkos.

The Connecticut Business and Industry Association, which had asked Malloy to roll back the business tax increases, also wants lawmakers to reopen the budget and consider recommendations from the Connecticut Institute for the 21st Century.

The nonpartisan, nonprofit organization of business and civic groups has suggested ideas such as increasing the number of residents receiving long-term care at home rather than a nursing home, cutting state prison costs and creating a hybrid or defined contribution plan for new state employees rather than a traditional pension.