Lawmakers urged to scrap Malloy's car tax plan

HARTFORD, Conn. (WTNH) -- It's an unpopular tax so many people might like the idea of not having to pay motor vehicle taxes anymore but cities and towns say it would hurt their bottom line and potentially force them to raise property taxes.

The Governor's proposal to eliminate the car tax for vehicles valued under $28,000 has gotten some applause from taxpayers but yielded concern from some municipal leaders who wonder where lost revenue will come from.

"I think I'm like every other mayor in the state. We've already cut personnel to the bone, we've taken furlough days, we've had early retirements, we've eliminated positions, I don't see anyway but basically shutting the city down," said Norwalk Mayor Richard Moccia.

"Let's be frank about this budget proposal. This budget proposal will increase taxes," said Jim Finley.

Jim Finley, with the Connecticut Conference of Municipalities, testified today before the Finance, Revenue and Bonding Committee. He believes if car taxes are cut, there would be a loss of at least 128-million in unrestricted, general fund revenues, impacting, among other things, school budgets.

"Someone is going to say, 'Look, I don't want to pay that 400, 500, 600 dollars in car tax anymore.' Your response to them is what," asked News 8's Jamie Muro.

"The response is you are going to pay one way or the other, you're either going to see reduced services, municipal employee layoffs, or you're going to see higher taxes on your house, or if you own a small business in your community your property taxes are going to go up," said Finley.

State Senator Martin Looney believes the Governor is right to address a problematic issue in the tax structure.

"Whether it is a slower phase out of the tax, or doing it as a statewide rate and distributing it back to the municipalities that way," said Senator Looney.

But how much or how little that may be continues to worry city leaders.

"The cities did not put the state in debt, they did that up here," said Mayor Moccia.