Perillo slams Malloy’s car tax plan; Says could cost Shelton $6.2 million in annual revenue

State Rep. Jason Perillo of Shelton has taken aim at Gov. Dannel P. Malloy’s proposed elimination of the motor vehicle tax, a centerpiece of the budget Malloy has submitted to the legislature. Perillo, a Republican, said the Democratic governor’s proposal would hit local taxpayers hard if it should pass.

In particular, Perillo pointed out getting rid of the car tax would eliminate $6.2 million in tax revenue for the city of Shelton.

“The only way for a town or city to make up the revenue they lose after the governor blows a giant hole in their budget is to raise taxes on homeowners,” he said.  “And the increase would be significant.”

Perillo said this isn’t the first time such a proposal had been offered. “Gov. [Jodi] Rell proposed it several years ago,” he said. “The difference between the Rell proposal and the Malloy proposal is that Gov. Rell found a way to pay for the transition and make towns and cities whole for the loss. Gov. Malloy isn’t doing that.”

Specifics of the proposal

The Malloy proposal would exempt a vehicle’s first $20,000 of assessed value from local property tax. Anyone with a vehicle at a market value of $28,571 or under therefore would pay no taxes on their vehicle.

Impact on municipalities

According to the state legislature’s nonpartisan Office of Fiscal Analysis, the Malloy plan would result in a loss of $633 million for municipalities across the state, and a drop in revenue for Shelton of $6.2 million.

“As most municipalities finish crafting their local budgets months before the state does, these towns will be negatively affected if this car tax proposal passes, and forced to reopen their budgets because of this artificial emergency,” Perillo said.

 Perillo: No real savings

Perillo said while it may sound tempting to eliminate the tax, the proposal doesn’t translate into any savings for local taxpayers.

“It’s quite the opposite actually,” said Perillo. “Whatever local government loses from car taxes will have to be made up somewhere else, and that somewhere else is still your pocket. You’ll be taxed at a higher rate on your property, and the likely result is that most middle-class residents will end up shelling out more than they just paid their car taxes. This proposal hurts many and helps none.”

About Rep. Perillo

Perillo represents the 113th House District, which takes in most of Shelton. He is an assistant House Republican leader. He was first elected in a 2007 special election. The current session of the state Legislature will adjourn on June 5.