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Gov. Malloy Seeks To Scale Back New Budget's Business Tax Hikes

Chion Wolf
Gov. Dannel Malloy in a WNPR file photo.

Governor Malloy is asking lawmakers to roll back $223.7 million in tax hikes to businesses in the new two-year budget. Those tax increases prompted some major employers to discuss possibly moving out of the state. Malloy said his plan addresses their concerns.

"I took the time to hear from the business community and others, and I'm putting forward what I think is a proposal that goes a long way in addressing many of the challenges," Malloy said at a news conference Friday. 

The governor's "budget improvement plan" would scale back the increase in sales tax on data processing and other online services and delay until next January the requirement for corporations to report income earned out of state. The governor's plan also scraps the sales tax on car washes and parking.

Malloy proposed paying for the tax cuts by asking lawmakers to give him authority to cut up to 1.5 percent on all line items in the budget not tied to contracts, including funding to municipalities. 

Senate Majority Leader Martin Looney said he will consider the governor's proposal, but reminded reporters that the budget must do more than just address the concerns of the state's largest corporations.

"The large number of people who are traumatized by the threatened loss of social services in this state, obviously their voices have to be heard, as well as the voice of the CBIA and others," Looney said. 

The governor's budget chief Ben Barnes said Malloy's plan would cut spending by $97 million next year, and $128 million in 2017. 

Ray Hardman is Connecticut Public’s Arts and Culture Reporter. He is the host of CPTV’s Emmy-nominated original series Where Art Thou? Listeners to Connecticut Public Radio may know Ray as the local voice of Morning Edition, and later of All Things Considered.

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