Lawmakers will examine a proposal to raise Connecticut’s sales tax this week. The Connecticut Conference of Municipalities wants to see an increase in the sales tax from 6.35 percent currently, to 6.99 percent. The idea is that the additional revenue should be given to cities and towns so they can control a rise in property taxes.
Joe DeLong of CCM said he doesn’t want to see an overall tax hike, but rather what he terms revenue diversification for his members.
Appearing on WNPR's Where We Live, he pointed out Connecticut’s sales tax is lower than most surrounding states. For instance, Massachusetts levies a sales tax of seven percent.
"If we can grab some of that capacity where we can stay competitive and use it to reduce property taxes, and become more competitive in the area of property taxes," he said, "then we think that will generate economic growth within Connecticut."
But the proposal isn’t popular among merchants who have to levy the sales tax.
Tim Phelan of the Connecticut Retail Merchants Association said states like Massachusetts have more generous exemptions from the sales tax on essential items such as clothing and footwear.
He said his members are already suffering because a lot of online shopping is still tax free, and that makes brick and mortar stores uncompetitive.
"If you increase the sales tax, you will just exacerbate that move to making purchases online, which won't help anyone, least of all cities and towns that are going to need money from the state," said Phelan.
The legislature's Finance Committee holds a public hearing Tuesday on the bill.
