Alberts Opposes Record Tax Hikes
Tax Hikes Contained in Controversial State Budget Proposal
HARTFORD—State Representative Mike Alberts (R-Woodstock) today voted against a controversial two-year state budget proposal by Governor Malloy and majority Democrats built on questionable revenue schemes, increased government spending and middle class tax hikes that threaten Connecticut’s fragile economic recovery. The proposal also contains a $2 billion hole of assumed union concessions, yet to be agreed upon by state employee unions.
Majority Democrats pushed their $40 billion budget pact with Gov. Dannel Malloy through the House by a 83 to 67 vote. The Democratic package narrowly passed the state Senate in 19-17 vote early Tuesday morning. The budget now merely awaits signature from Malloy—the architect of the largest tax increase— about $2.09 billion in the first year alone—in state history.
“I’m truly disappointed that Democrats in the legislature and Governor Malloy ignored Connecticut taxpayers. They missed their first opportunity to show Connecticut residents they are ready to responsibly lead our state as a unified majority government. Instead of scaling back, much like most of us are already doing, the majority party in the legislature has once again ramped up state government in size, spending and taxation. ‘Shared sacrifice’ has turned out to be code for ‘more taxes’,” said Alberts.
Alberts especially noted the retroactive nature of tax hike for middle class wage earners who may have already assumed their same level of income this year but will now have to readjust. There is also a sales tax hike that will make goods and services with already-increasing prices even more expensive. Democrats have taxed everything from non-prescription drugs to concert tickets and have stripped the tax-free exemption for clothing and shoes under $50. The $500 property tax exemption for homeowners was slashed by 40 percent, too. “Every Connecticut resident will be effected, there is no escape. These taxes will directly affect our everyday lives, increasing our skyrocketing cost of living. Unfortunately, the least will be hurt the worst. Those on fixed incomes such as Social Security or unemployment will be hit hardest. Democrats have shown their true colors of being unable to show spending restraint,” said Alberts.
Alberts also expressed concern on about tax increases on job providers. “Connecticut’s unemployment rate is above the national average of just over 9 percent. Many of Connecticut’s large employers losing or moving jobs out of state— such as Pfizer moving over 1,000 Connecticut jobs to Massachusetts. I recently toured a large manufacturer in Eastford, Whitcraft, whose owners told me how difficult it is to do business here as a manufacturer because we have the highest energy rates in the mainland United States. While that manufacturer wasn’t one of those in the headlines, many Connecticut manufacturers have been posting job losses in the hundreds. With reports like these, I have to question the decision by Governor Malloy and state Democrats to double the corporate tax rate from 10 percent to 20 percent. Is this in Connecticut’s best economic interest to hurt businesses at a time like this? As I see it, we should encourage companies, like these, that call our state home. It’s just common sense,” said Alberts.
The state revenue estimates in the budget rely on controversial tax schemes that the state’s top tax collector warned won’t work. The Governor’s own Revenue Services Commissioner has already said that the so-called Amazon Internet Tax is “uncollectable’’ and that taxes on plastic surgery would also not be workable. These taxes are assumed in revenue estimates to keep the budget balanced. However, even with this forewarning from the commissioner, Democrats still pushed their budget forward, a move Rep. Alberts called “a questionable accounting trick.”
Alberts also called the $2 billion in state worker union concessions “a gamble” for Democrats and the Governor to assume in approving their budget before securing any union agreements. The concessions are necessary to keep their biennium budget in the black, but have not been agreed upon by unions. “It seems a bit rash to rush this budget through the legislature without any certainty from unions” said Alberts.
In an effort to provide potential tax relief to residents on an issue supported in a recent state-wide poll across party lines, Rep. Alberts introduced an amendment (LCO 5774) to cap state gasoline taxes. The amendment failed along party lines.
Prior to the Democratic budget vote, Republicans offered their alternative “no tax increase” budget on the floor. This proposal rolled back government spending and size to levels in prior budget years and closed the deficit with zero tax increases, fully funding municipal and education aid, and preserving the social safety net for those in need. The Republican proposal spent $900 million less than the plan approved by House Democrats.
Among the steps Republicans used for savings in their “no tax increase” budget:
• Enhanced Medicaid fraud detection units will save roughly $224 million in wrongful payments.
• Republicans plan to save more than $46 million through agency consolidations.
• State government will be streamlined through attrition and reduction in the 54,000 state payroll.
• No money will be borrowed for day-to-day state operations.
• More than $200 million in the state’s highest cost debt will be pre-paid, thus allowing for greater flexibility in budgeting throughout state agencies.
Alberts concluded, “The only bipartisan budget vote today was a minority saying ‘No’ to the Governor’s proposal. Today Connecticut saw a clear choice. Majority Democrats made a pact with the Governor to deal with our fiscal crisis through bigger government with massive tax increases on income, property sales and businesses. I am proud that we proved there is an alternative way. We balanced the budget without raising taxes, but the Governor and the majority; much like they did to taxpayers across the state; turned a deaf ear.”