CT Gov. Lamont signals a bipartisan tax cut is ‘close’ as he marks AAPI month
When Jimmy Tran’s parents came to the U.S. in the 1970s, the young Vietnam War refugees had just $50 in their pockets. Fifty years later, the Trans’ supermarket is a thriving epicenter of Asian American culture in West Hartford.
Tran’s mother explained that between the pandemic, supply chain shortages and inflation, the last three years have been a challenge. The store had to close its doors for a month in 2020, products went off the shelves, and some customers did not return, but if the governor’s middle-class tax cut comes to fruition, the Trans are hopeful that business will improve.
A Dong Supermarket was the latest stop on Gov. Ned Lamont’s tax relief tour Tuesday, highlighting Asian American and Pacific Islander Heritage Month and the town of West Hartford, where Revenue Services Commissioner Mark Boughton said 60% of residents can expect some form of relief under the governor’s tax plan.
In the race to finalize budget negotiations by June 7, Lamont signaled that his administration and legislative caucuses are nearing a deal on the size and reach of the relief.
“Usually we’re talking about how much we have to raise taxes or how much we have to cut spending in key areas. Now we’re having a debate about how much additional investments we make in, say, education and how big a tax cut we’re going to have,” Lamont said, adding that increasing not-for-profit funding is also on the table. “I think we’re relatively close to where we ought to be. We’re all playing within the same rules. We’re all playing within the guardrails.”
Lamont’s fiscal plan calls for cutting the state income tax in two places, including lowering the 5% rate to 4.5% and reducing the 3% rate to 2%. When those are combined, families earning $100,000 per year would save $594 per year, which is more than a competing plan by Democrats that would cut the 5% rate to 4.75%.The Democrats’ tax plan called for a slightly higher income tax of 4.75%, while House Republicans stood by the governor’s proposed rate but on an accelerated timeline that retroactively applies relief to Jan. 1, 2023.
“We’ve earned this,” Lamont said. “We’ve gone through three years of really tough times. We’ve had five balanced budgets in a row. We’ve had a surplus that has allowed us to pay down some of our unfunded liabilities. We’re making the biggest commitments ever to education, university and day care in the history of the state. And at the same time, we’re able to afford a real tax cut.”
Lamont said an income tax reduction will offer tangible relief to small businesses like A Dong Supermarket that serve as cornerstones of their community.
“Our business is more than a place where people come to buy goods,” Tran said. “For Asian Americans, it’s a gateway to Connecticut and for Connecticut it’s a gateway into our culture.”
Tran said the tax cut would provide hardworking families across the state with the “breathing room” to invest in Connecticut’s and their own futures, from buying a house, starting a business, sending their children to college, to feeding their families without worrying if they will make their bills.
“His proposal to cut taxes for middle-class families and offer relief to many low-income families will save my family a couple of hundred dollars each year. Beyond that, it puts money back into pockets of our customers so they can spend a little more here,” Tran said. “For many of our customers who are first, second, third-generation Americans, keeping more of what they earn is the breathing room they need.”
Lamont and legislators are working to finish the two-year, $50.5 billion budget before the legislative session ends on June 7.
“We’re waiting to see the Senate Republican budget,” Lamont said. “It’s supposed to come out any day now. That will be the final piece. Frankly, I’m really thankful the Republicans came out with a budget. … Now, everybody’s got a budget on the table, and we’re pretty close. It makes the negotiations a lot more fruitful.”