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Back To The Future For Connecticut: A Heavy Sales Tax On Top Of Income Tax
The Newtown Bee ^ | 5/1/2003 | CHRIS POWELL

Posted on 05/01/2003 5:40:55 PM PDT by Willie Green

For education and discussion only. Not for commercial use.

Connecticut couldn't be in much worse of a mess. Despite income tax increases and the manipulation of state budget accounts last year, state government's finances continue to collapse and the deficit grows. While the General Assembly seems ready to outlaw smoking in bars and restaurants and otherwise meddle in everybody else's business, most legislators remain in denial about their own, and a large minority is eager to repeal the state Constitution's limit on spending or to drill more holes in it. And now Governor Rowland seems incapacitated by scandal.

The governor's former deputy chief of staff has pleaded guilty to unspecified federal bribery charges involving the award of state contracts. The governor himself has admitted using a Republican Party credit card for personal expenses but refuses to explain the scope of his conduct or the possible consequences to himself under tax law and ethics regulations. His musings the other day about seeking a fourth term, after having forsworn the possibility last year, struck even his friends as a pathetic gesture at regaining relevance, and prompted only mockery from his enemies, not new respect.

While Rowland has presented the legislature with a tight budget including a few structural reforms, he has done little to support them and they are being ignored. He seems willing to react to whatever the legislature does, whenever it does, if ever it does.

What's Connecticut to do?

The likely path of least resistance was sketched out the other day by House Speaker Moira Lyons, who suggested raising the sales tax by a half point to 6.5 percent. Tax-hungrier Democrats are talking about taking the sales tax to seven percent if they can't get the governor to approve another increase in income taxes.

When the income tax was enacted in 1991 its great rationale was "tax reform," a profound reorientation of Connecticut's tax system toward profitability and wealth and away from mere transactions, like sales. The spending limit amendment to the state Constitution was offered to the voters at referendum a year later as a promise that the profligacy of state government in the 1980s wouldn't happen again.

The income tax raised a huge amount of new money and a little of it was returned to the taxpayers by reducing the sales tax from 8.5 percent to 6 percent, which was still steep. But the income tax quickly facilitated another explosion in state spending and bonding in the 1990s, elected officials quickly forgot that good times don't last forever and that tax revenue fluctuates with economic cycles, and now state government has managed to outrun the income tax just as it outran the sales tax.

So Connecticut may go back to a heavy sales tax system and plunk it on top of its heavy income tax system. And though suggestions of corruption abound, on top of expensive failures of ordinary public administration, from the Connecticut Resources Recovery Authority to the Department of Children and Families to drug criminalization to government labor relations, there is no impetus in state government for stepping back to inquire whether anything should be done differently, or maybe not done at all.

Republican legislators can't think of much to do besides pledge their refusal to repeal the spending cap. Insofar as there is any leadership in the Democratic majority in the legislature, it is all for raising taxes. And the several Democratic state constitutional officers who are considered possible candidates for governor in 2004 -- Attorney General Richard Blumenthal, Secretary of the State Susan Bysiewicz, and Comptroller Nancy Wyman -- have nothing to say about Connecticut's dire circumstances, nothing to say even about the Rowland administration's corruption, which would be an easy target if only for partisan purposes. The leading Democrats apparently do not yet see any reason to lead.

Not that it would be such a disaster if the governor held out against the minimum tax increase legislative Democrats would settle for and a long stalemate on the budget developed. In that case more authority over spending would default to the governor. Instead of trying to whip legislators and the public into submission by closing state parks in the heat of summer, as his predecessor did, Rowland should try closing things the public would never miss, like the Education Department and the Permanent Commission on the Status of Women. Even in hard times state government is still full of such stuff.

(Chris Powell is managing editor of the Journal Inquirer in Manchester.)


TOPICS: Business/Economy; Editorial; Government; US: Connecticut
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1 posted on 05/01/2003 5:40:56 PM PDT by Willie Green
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To: Willie Green
A relative short drive and you ain't in Conncutnut no more. Think about that, Monica.
2 posted on 05/01/2003 6:07:43 PM PDT by Waco
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To: Willie Green; #1CTYankee; .303 Brit; Agamemnon; AGBRUHN; always vigilant; Anarchist; Andonius_99; ..
time to move.
3 posted on 05/01/2003 6:19:28 PM PDT by RaceBannon
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To: Willie Green
All the tax increases in the world will not be able to satisfy unbridled spending. What is so #&%*#*@ difficult to understand about that.
4 posted on 05/01/2003 6:35:50 PM PDT by caisson71
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To: RaceBannon
With some of my copious free time last year I deteremined that the state budget of CT divided by the area of the state worked out to the state spending $0.10 per Square Foot of the entire state.

A dime per square foot! Of the entire state.

Really, would all hell break loose if we only spent 0.07 per Square Foot?

5 posted on 05/01/2003 6:47:34 PM PDT by Fixit
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To: RaceBannon
As if I don't pay enough for school, gas, insurance, etc...they gotta jack up the sales tax, too. Thank you sir...may I have another?!?!?!?
6 posted on 05/01/2003 7:01:27 PM PDT by Andonius_99
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To: Andonius_99
You idiots voted for Lowell Weicker and bought his income tax and now you have the worst of all worlds. Its too bad but that the way its come down. If only you had all said NO to the income tax in the first place, you wouldn't be in this fix today. Pretty ironic for a place that styled itself the Constitution State.
7 posted on 05/01/2003 7:19:31 PM PDT by goldstategop ( In Memory Of A Dearly Beloved Friend Who Lives On In My Heart Forever)
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To: Willie Green
Ugh. Remind me again why I wanted to stay in this state...
8 posted on 05/01/2003 7:52:21 PM PDT by Rubber_Duckie_27
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To: goldstategop
You idiots voted for Lowell Weicker and bought his income tax and now you have the worst of all worlds.

You got that right! I can't tell you how hard I tried to keep him out of office because I knew the income tax was coming if he did. Citizens of CT, you got what you voted for and what you deserved. I'm glad I moved.

9 posted on 05/01/2003 7:55:46 PM PDT by gtech (Don't sell me out and expect my vote.)
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To: Rubber_Duckie_27
Texas sounds better and better.
10 posted on 05/01/2003 7:55:55 PM PDT by Orange1998
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To: Willie Green
Isn't there ANYTHING we can do to at least express our displeasure with these freaking MORONS?
11 posted on 05/01/2003 8:21:11 PM PDT by ModernDayCato (Every legislator should have to take a basic economics class to take office)
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To: Willie Green
LOFL, this is hilarious stuff.
Connecticut sounds almost as pathetic as California.
I bet the decent, working people of Connecticut want to dig up Lowell Weiker's corpse just so they can spit on him again. What a scumbag he was. That's if he's dead yet, I mean.
12 posted on 05/01/2003 8:26:28 PM PDT by Lancey Howard
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To: Waco
I do not know about state laws in Conneticut. In Washington State, fortunately there is an initiative process to keep our state government in check. The Washington state government recently convened a conference about taxes and how much better an income tax would be and if the state had one, we would do away with the sales tax (yeah, right). The committeee was staffed by a bunch of Uber-liberals, like Bill Gates father, and other limousine liberals.

Fortunately, the state legislature realizes that it would be overturned via the initiative process if they try to shove an income tax down our throats.

13 posted on 05/01/2003 8:52:03 PM PDT by eeman
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To: Waco
A relative short drive and you ain't in Conncutnut no more.

True, Connecticut is only about 110 miles wide at I-95, and it is probably 80 miles from the shore to the top of the state. However, it's a short drive to even worse states. NY state taxes are a lot higher than Connecticut's, especially if you consider property taxes, which are a lot higher in Westchester County than Fairfield County. Massachusetts on the north? Mass isn't known for being a low tax state. And to the east, you've got Rhode Island. Also not a tax haven.

CT does have low property taxes, at least in the right towns. My house is worth at least $500K, and I pay property taxes of only $3100 per year in Greenwich.

14 posted on 05/01/2003 9:16:45 PM PDT by Koblenz (There's usually a free market solution)
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To: RaceBannon
time to move.

We've considered it lately, believe me. As I said on that thread about Pataki and New York's huge fiscal woes, those lower-tax RED STATES have really been starting to look good to me lately!

Thanks for the ping.

15 posted on 05/01/2003 9:50:50 PM PDT by nutmeg (USA: Land of the Free - Thanks to the Brave)
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To: Willie Green
The income tax raised a huge amount of new money and a little of it was returned to the taxpayers by reducing the sales tax from 8.5 percent to 6 percent, which was still steep. But the income tax quickly facilitated another explosion in state spending and bonding in the 1990s, elected officials quickly forgot that good times don't last forever and that tax revenue fluctuates with economic cycles, and now state government has managed to outrun the income tax just as it outran the sales tax.

Wow !!! Never expected that to happen when they shoved the income tax down our throats < /sarcasm >

What I've been wondering is where all the revenue generated by the casinos is going? What economic geniuses we have running this state, rasing taxes through the roof during an economic downturn. Has it occured to our RINO governer that revenue is down because unemployment is up?

16 posted on 05/02/2003 4:40:55 AM PDT by YankeeReb
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To: Lancey Howard
I bet the decent, working people of Connecticut want to dig up Lowell Weiker's corpse just so they can spit on him again. What a scumbag he was. That's if he's dead yet, I mean

Unfortunately he has not yet found his final resting place (burning in a very hot fire).

He dares not show his face in the state these days for fear of being seized by a mob and placed in the stock in front of the Old State House.
17 posted on 05/02/2003 4:56:07 AM PDT by cgbg
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To: goldstategop
You idiots voted for Lowell Weicker and bought his income tax and now you have the worst of all worlds.

Lowell also got confronted at the State Capitol and was spat upon by an angry mob when he showed his face, albeit very briefly. He had no idea the wrath he would face as he tried to shout down the mob of us that were there that day.

That said, the real culprit for the income tax passing was a Republican State Senator by the name of Marie Herbst, who cast THE deciding vote. All of these things you see being proposed were supposedly "safeguards" which she insisted upon being in place so Lowell and the Democrats would get her vote.

I spoke with Marie Herbst and told her she was an absolute fool for thinking that any safeguard would stand through a budget deficit brought on by wanton spending of "windfall" tax receipts and a downturn in the state's economy.

When she insisted upon defending her vote to enact the income tax because there were safeguards to make sure that runaway spending and future increases would not happen, I went door-to-door in her neighborhood and her town telling people what an idiot we had for a state senator.

She was soundly defeated in the next election.

That said, I am thankful that I live within five minutes of gas stations in Massachusetts where gasoline is 10 cents a gallon cheaper because Connecticut already has the one of the highest gasoline taxes in the nation. I also do shopping in Massachusetts where sales tax is 5%.

18 posted on 05/02/2003 6:31:36 AM PDT by N. Theknow
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To: N. Theknow
We can't lose sight of another fact...

Kansas has about the same population as CT.

Kansas's state budget is $4 billion a year.

And Connrcticut can't get it done with $13 billion ?

Is our cost of living and everything THREE TIMES that of Kansas. NO

The spending is out of control, it has been for over a decade, LOWER the taxes.
19 posted on 05/02/2003 7:23:10 AM PDT by George from New England
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To: Lancey Howard
No, I confess you'd be spitting on a live body. Go ahead, it's worth it.
20 posted on 05/02/2003 7:25:12 AM PDT by George from New England
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