By CHARLES PEACOCK
Connecticut’s new governor, Democrat Ned Lamont, offered a new budget plan on Wednesday. Its intent is to modernize the state’s sales tax base by imposing a 6.35 percent levy on a long list of goods and services. It also proposed highway tolls as way of funding transportation and takes steps to stabilize the state’s pension systems and make government more efficient.
The wealthy businessman-turned Democratic politician said he hopes the initiatives in his two-year, $43.1 billion tax-and-spending plan, coupled with input from the Democratic controlled General Assembly, will finally address Connecticut’s stubborn budget deficit challenges.
Lamont’s message has received mixed reactions from lawmakers, especially Republicans who voiced their concern on his choice to impose a sales tax on everything from legal services and haircuts, to child car seats and vegetable seeds. While this plan retains the existing sales tax exemption on food, it eliminates it for newspapers, textbooks, campground rentals, non-prescription drugs and selection of other items and services.
It also eliminates the annual sales-tax-free week in August, imposes higher taxes on electronic cigarettes, and creates a 10-cent plastic bag surcharge. The plan rids citizens of an increased exemption from the personal income tax for Social Security and pension income. Lamont also proposed two options for electronic highway tolls: only for big trucks or for both trucks and cars.
“What troubles me about Lamont’s budget is that I see very little on the spending side. All I’ve been hearing is ‘tax this’ and ‘tax that,’ but I’m not hearing enough in terms of spending and how were going to cut spending,” said Sacred Heart Political Science Chair, Dr. Gary Rose.
Beyond this, Rose discusses the issue of balancing a budget by raising taxes and the problems that may surface.
“You can’t balance a budget just simply by raising taxes, you have to also have a combined approach. On Ned Lamont’s budget, it is not going to rectify what I think is an ongoing, growing problem in Connecticut,” said Rose.
Lamont plans to implement this new sales tax law in the coming months and hopes that it will get Connecticut out of a “$3.7 billion deficit over the next two years,” according to Lamont. Dr. Rose believes that we as a state will remain over-taxed if this law is implemented.
“Connecticut is going to remain an over-taxed state, I think we are going to see more companies leave Connecticut or some who were thinking of coming, not coming. I don’t see much in terms of economic growth coming in Connecticut largely because we have a democrat who believes that taxation is the answer,” said Rose.
“The governor and state need to find a way to generate income and one of the ways to do that is to encourage small businesses with incentives to grow and provide jobs,” said senior business major, Kevin Plant.
Lamont must also reach an agreement with unionized state employees about his
proposed pension changes, such as requiring cost of living adjustments to meet market returns and removing mileage reimbursements from pension calculations.
Sal Luciano, president of the Connecticut AFL-CIO labor umbrella group, said he was disappointed Lamont broke a campaign promise not to seek further givebacks from state employees while not asking the wealthy to pay higher income taxes.
“Instead of cutting retirement benefits, we hope the Governor will consider finding smart ways to balance the budget,” Luciano said in a written statement.
The Associated Press contributed to this article.