To the Editor,
On Nov. 11th, the Hartford Business Journal’s editorial was headlined, “Governor’s race must focus on CT’s tax burden.”
There is no argument that our state needs to continue its efforts to encourage business and job creation. But when it comes to businesses, Connecticut is not “[c]ontinually…ranked as one of the least tax friendly states in the country.” Citing the no-tax-is-a-good-tax Tax Foundation’s erroneous methodology does not make it so.
Where does Connecticut rank overall in its effective business tax burden? Only one business-funded and hardly pro-tax group gets it right. A more balanced view would at least include the Council on State Taxation annual rankings. COST’s ranking shows that Connecticut actually has the lowest business share of total taxes and is tied with four other states for the lowest total effective business tax burden. Unlike the Tax Foundation, COST’s analysis even includes local property taxes, unemployment taxes and business fees.
HBJ is more accurate when citing Kiplinger’s ranking of high local property taxes as an important factor in business location. But just imagine what the business and residential property tax burdens would be today in Connecticut if Governor Malloy had followed his predecessors in cutting municipal aid and school funding to cities and towns.
Also troubling is the editorial comment that reminders about the worst-in-the-nation state fiscal mess Governor Malloy inherited are somehow “getting a little tired.” Political amnesia is not something we can afford just now when the fiscal discipline imposed by Governor Malloy has finally turned around the state’s struggling cash flow and brought modest budget surpluses that are refilling the state’s “rainy day” budget reserve. Indeed, that discipline and stability are exactly why we can even consider ways to align tax policy with economic growth as recommended by the Governor’s 2012 Business Tax Task Force.
Is there room for improvement? Of course, and Governor Malloy gets it — making Connecticut even more competitive in terms of education, transportation, energy and taxes.
Kevin B. Sullivan commissioner Department Revenue Services
