HARTFORD, Conn. (WTNH) – Lawmakers at the state Capitol heard testimony from taxpayers Thursday during a public hearing.
Several tax proposals are on the table this session, including making the earned income tax credit change permanent, reducing the state’s 6.35% sales tax, gas credit for drivers, and a cut in the car tax.
There are some tax increases aimed at the rich. There are record surpluses this year in the budget, and a full rainy-day fund.
Lawmakers are looking at giving taxpayers relief in this election year. How much money can you potentially save? It depends on what ideas pass.
Gas, food, property, cars, and income it is all taxed to pay for the government to run.
“I had to drop out of the university to support my mother and pay rent,” Nayeli Garcia from West Haven told lawmakers.
Lawmakers agree reforming the tax structure in Connecticut is overdue. A recent tax incident report shows a trend, working and middle-class families pay the most. People earning up to $74,000 a year saw 26% of their earnings go to taxes, compared to top earners who paid far less.
Senate Minority Leader Kevin Kelly, R-Stratford, said his caucus is proposing a temporary cut to the sales and use tax and the meals tax.
“Many families are living hand to mouth, paycheck to paycheck,” Kelly said.
Republicans say inflation is causing pocketbook pressure. It’s among the many ideas on the table, and one that covers every tier of working people.
Other tax cut ideas: a child tax credit, a cut in the car tax, a property tax credit, a gasoline credit of $50 for licensed drivers.
Tax increases on the table aimed at the rich include a capital gains surcharge and a mansion tax on homes worth more than $1.7 million.
Senate President Pro Tempore Martin Looney, D-New Haven, is the sponsor of the idea.
“It [mansion tax] would be a reliable revenue stream,” Looney said.
One tax credit Democrats are at odds over: the earned income tax credit. Some want it expanded permanently, but Democratic Gov. Ned Lamont, who did increase the credit temporarily, said a permanent measure would be too costly.
“If we add on more tax cuts, we are going to go right back to that lurching from crisis to crisis,” Commissioner Mark Boughton from the Department of Revenue Services said.
Boughton said the impact of these moves must be watched.
Adding revenue collected from the top 747 wealthiest tax filers in Connecticut adds up to the amount of tax collected from 800,000 middle-class tax filers.
Where is the economy headed? And job growth those are a concern too.
“If working people get no relief from those elected to represent us, what reason do we have to turn out and vote?” Jaime Myers-McPhail of New Haven testified before lawmakers.
On average, we calculate a working family of four with two children, two cars and a modest home could potentially save up to $2,300 a year if some of these cuts were passed.
Child Tax Credit = $1,200
Car Tax cut = $400
Property Tax Credit = $400
Meals and Sales Tax Cut = $250
Gasoline Use Credit = $50
There’s a public hearing on the car tax cut proposal Friday.