Editorial: Gov. Malloy’s misguided car tax scheme

To say it’s cynical of Gov. Dannel P. Malloy to propose phasing out property taxes on motor vehicles worth less than $28,500 would be an understatement.

Gov. Dannel P. Malloy

Gov. Dannel P. Malloy

It’s like telling your friend Jim the Barber he should stop charging all of your friends when he cuts their hair. For Jim the Barber, it’s required labor but a loss of income. For you, it makes you very popular with all your friends because they will no longer have to pay Jim to get their hair cut.

Phasing out the car tax has been suggested before in Connecticut, but others often have at least suggested the state would make up some or all of the resulting lost income for Connecticut’s 169 towns and cities.

Malloy hasn’t suggested that. Instead, he’s had the audacity to brag that his budget proposal would “provide tangible relief to our middle class, including relieving them of the most hated and unfair tax in Connecticut — the car tax.” And to top that, he’s actually boasting that eliminating the car tax will save towns money because they “will no longer be responsible for collecting it.”

Yes, people hate the car tax. It’s irritating to have to pay hundreds of dollars in additional property tax to your hometown for every vehicle you own.

And it is an especially onerous tax when it comes to fairness and equity because mill (tax) rates vary so much from community to community, meaning someone in Bridgeport is paying many times more in car taxes for the same car as someone in Greenwich. Unlike with homes, car values don’t differ by what town you live in, providing some sort of balance to the unequal mill rates.

 

Towns depend on the revenue

Towns depend on car taxes for millions of dollars in revenue. As of October 2012, Shelton had $306 million worth of assessed vehicles. That generates a lot of tax money for Shelton.

Malloy has no right to suggest cutting off a revenue source to towns and cities while making no effort to make up for the lost revenue. He knows his proposal has no chance of passage. He is just hoping that in the future, people will think of him as the person who wanted to eliminate their car taxes. It’s about image, not public policy.

Two years ago, Malloy pushed through the largest tax increases in state history. He inherited a mess and, for the most part, the taxes were necessary. He also supported some limited spending cuts and promised an end to budget gimmicks.

Now he’s resorting to a cynical political move that borders on demagoguery.

Like Jim the Barber, our hometowns need money to function. The legislature should reject Malloy’s car tax scheme. Perhaps it’s time the governor got a haircut instead of the taxpayers.

 

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