Tax Alert: Connecticut Legislators to Address Growing Budget Deficit
12/18/2009
Connecticut Governor Rell, who recently announced that she will not seek re-election, called the state legislature into a special session, beginning December 15, to address the current estimated $500 million state budget shortfall resulting from the continuing decline in state revenues.
Please note the following:
- Although there was a scheduled, contingent rate reduction in the Connecticut sales tax beginning January 1, 2010 (i.e., the 6 percent rate was scheduled to decrease to 5.5 percent), the State acknowledged that there will not be enough revenue to sustain that decrease. Accordingly, Connecticut’s sales tax rate will remain at 6 percent.
- Governor Rell has proposed no tax increases or other tax changes. She has only proposed spending cuts, including cuts in aid to cities and towns, thus increasing pressure on city and town property tax revenues.
- Given the size of the deficit, we expect to see additional tax proposals during the special session.
For more information about this and other Connecticut state tax issues, please contact your J.H. Cohn advisor or Patrick J. Duffany, J.H. Cohn State and Local Tax partner, or Brenden M. Healy, manager, at 860-633-3000.
Patrick J. Duffany, CPA, J.D., is a tax partner in J.H. Cohn LLP's State and Local Tax Group, where he specializes in multistate taxation issues with an emphasis on New York and Connecticut state tax issues. He may be reached by email or at 860-368-3607.
Brenden M. Healy, CPA, is a tax manager in J.H. Cohn's State and Local Tax Group. He may be reached via email or at 860-368-5246.
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