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Tax Study Author: Connecticut Is a High Tax State

Charlie Smart
/
WNPR
Andrew Phillips of Ernst and Young.
Connecticut's overall state and local tax collections are 57 percent higher than the national average, according to the study.

Governor Dannel Malloy has taken to citing a tax study by Ernst and Young which he claims shows Connecticut has among the lowest corporate tax rates in the nation.

But the lead author of the study doesn’t agree with the governor’s interpretation, and on Monday, the Connecticut Business and Industry Association invited Andrew Phillips to explain why.

Phillips told a press conference that the measure the governor is using looks at the ratio of business taxes to economic output, which is low because of the state’s above average productivity. "When Connecticut’s business taxes are measured per employee, as opposed to per dollar of economic activity," he said, "Connecticut ranks 27th, suggesting that it’s actually comparable to the U.S. average.

But that wasn't the worst news.

"Considering both household and business taxes," Phillips went on, "Connecticut’s overall state and local tax collections are 57 percent higher than the national average, on a per capita basis, and 15 percent higher when measured per dollar of personal income."

Credit Charlie Smart / WNPR
/
WNPR
Adrienne Cochrane of the Urban League of Hartford.

The CBIA also tackled the perception that all non-profits want to see the business community take more of the strain.

Adrienne Cochrane from the Urban League of Hartford told the media many non-profits have close links with corporations. "So consider," she said, "state funding is cut, federal funding is cut. To lose the support of our corporate and business supporters would strike a fatal blow to many non-profit organizations."

After an outcry from corporations in the state over proposed tax hikes in the new biennial budget, Governor Malloy has said he wants to see a 1.5 percent cut in the spending recommended in the budget passed by the legislature earlier this month.

Harriet Jones is Managing Editor for Connecticut Public Radio, overseeing the coverage of daily stories from our busy newsroom.

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