Republican gubernatorial candidate and Mayor of the City of Shelton, Mark Lauretti, has issued the following statement regarding the May 3, 2018 Tax Freedom Day in Connecticut.
After six straight years of last place finishes among the 50 states and the District of Columbia (DC), Connecticut is now tied with New Jersey and DC as second to last states to celebrate tax freedom day; the day when taxpayers have earned enough to pay their federal, state and local taxes for the year according to the nonprofit Tax Foundation. Connecticut taxpayers must work longer than taxpayers in 47 other states to achieve tax freedom; taxpayers in New York will work longer than anyone in 2018. You can view that article by clicking here:
While Connecticut has managed a very weak increase in tax competiveness relative to the state of New York, CT still ranked last (50th) among states on economic performance according to the 2018 “Rich States, Poor States” scorecard. In Don Klepper-Smith’s recent Op-ed in the Hartford Courant, “Poor Fiscal Policy Mortgaged State Future,” Klepper-Smith was pessimistic in his forecast for Connecticut. Klepper-Smith, who is an economist, believes the current trend of anemic job growth and out migration (negative population growth) will continue into the future if the state does not address the current failure of economic incentives.
Klepper-Smith states, “Unfortunately, we’ve created a borderline antagonistic business environment of haves and have-nots. Our political system for picking winners and losers for state economic development funds is counterproductive to long-term economic growth. The “First Five” initiative is like a parent saying, “I’ll feed some on my kids, the rest of you can go hungry”. You can view that article by clicking here:
Governor Malloy’s “First Five” program and Connecticut Department of Economic and Community Development (DECD) were recently criticized by state auditors for “overstating jobs saved through tax breaks and taxpayer funded initiatives”, according to the New Haven Register article, “Audit: State agency inflated job created”. You can view that article by clicking here:
Lauretti stated, “State corporate tax abatements are not working and worse, a state agency is lying about the effectiveness of the program. Corporate tax abatements are a shortcut to attract businesses. States and cities resort to tax incentives when they have become economically unattractive. Cutting spending and maintaining a low tax rate for everyone, residents and businesses, is the fair way to promote prosperity. As a mayor and economic development director for a city, I have followed this policy of fair taxation for 27 years. Despite tax incentives from other Connecticut municipalities, businesses and residents continue to move to Shelton. Ten consecutive years without a tax increase and over twenty years of reducing the mill rate has turned Shelton into an employment hub for over 25,000 daily commuters.
Lauretti concluded, “A fair taxation policy that reduces spending and levies a stable and low rate among residents and businesses will improve our competitiveness with northeastern states and make Connecticut affordable and attractive. Economists agree that we must change course quickly and end selective tax incentives in favor of uniform tax rates. Klepper-Smith concluded, “What makes more sense and is harder to do is formulate policies that target the entire business community for the potential benefit of all and let the marketplace determine who succeeds. Connecticut’s poor economic performance can be attributed in part to investment that is being redirected elsewhere. Creating policies that are conducive to growth for all businesses, not just a select few should be a priority.”