On July first, the Governor’s budget takes effect and levies many new taxes and fees. Some (income, gift and estate taxes) are retroactive to January 1, 2011.
New and Increased State Taxes in Connecticut:
• Income tax increases in all brackets
• Sales tax increase, from 6% to 6.35%
• Clothing under $50 now subject to sales tax
• New tax on non-prescription drugs, vitamins, manicures/pedicures, yoga??
• Increased taxes on hotel rooms, cigarettes, alcohol
• Expansion of the gift and estate taxes
• Conveyance tax increase
• Real estate conveyance tax made permanent
• Decrease of $200 in property tax credit
• Diesel fuel tax increase from 26¢ to 29¢
• Increase in driver’s license and vehicle registration fees
• Hike in corporate surcharge tax?
These new taxes and fees will force families and businesses to readjust their budgets and their expectations. I did not support the Governor’s budget, and, as the economy improves, I plan to work to reduce and sunset these new taxes and fees. I will keep you updated.