Governor Ned Lamont proposed changes in business taxes in Connecticut that will collect hundreds of millions of dollars in revenue over the next two years from large, multistate corporations while limiting a tax loan that has prompted film and television production in the state.
Tax reforms were part of Lamonti’s proposed two-year budget of $ 55.2 billion, presented Wednesday morning in Capitol.
The Governor’s budget chief, the policy office and the management secretary Jeffrey Beckham said that the proposals “reform our corporate tax structure by eliminating policies that disinthins companies to find and grow in this country, and by eliminating preferential tax treatment for a handful of companies. “
Among the proposed changes is a plan to eliminate a $ 2.5 million in corporate tax lid for multistate companies reporting their income under what is known as combined unitary reporting. Beckham said the lid is bad politics.
Approximately 20 companies benefit from the current lid a year, Beckham said. But the state budget office predicted that its elimination can fully bring an additional $ 216 million in state tax revenue over the next two years.
A spokesman for the policy and management office said the state cannot issue a list of companies that benefit from that tax cap due to confidentiality rules.
Republicans in the legislature expressed concern about the unitary reform of the lids, suggesting that it can stimulate large employers to relocate.
“It’s a great gambling that the governor is getting,” said the minority leader of the house Vincent Candelora, R-North Branford. “We will hear from them [the companies] Through the legislative process, and I just hope they do not leave the state of Connecticut. “
Chris Dipetima, the President and CEO of the Business and Industry at Connecticut, said that removing tax lids can potentially increase corporate taxes for a number of businesses operating across countries.
Dipentima and other CBIA officials said they are looking closely at the budget process and the proposed tax changes presented by Lamont. But he stressed that lawmakers were at the beginning of what is likely to be a very long and complex budget debate.
The Governor also proposed lowering a tax loan for film, television and media producing companies that have benefited renowned entertainment companies such as EPSN, WWE and NBC-Universal, as well as a Christmas-themed film nile that the state has times The latter sought to promote his tourism campaign.
Beckham announced plans for a “modest reform” that would reduce the size of the maximum loan from 30% to 25%, which he said would bring an additional $ 26 million in the next two years.
Opponents, including lawmakers on both sides, have criticized film tax loans – a benefit of $ 1.5 billion for industry over the past two decades – as an unfair material for a relatively small part of the state economy. Last year, a proposal to give up with the loan failed fully in the face of the heavy industry opposition.
“Maybe it’s moving in the right direction,” said most of the home leader Jason Rojas, D-East Hartford. “Is this the best and highest use of the limited resources we have when it comes to a tax loan, compared to something else?”
However, supporters say loans have resulted in thousands of work for Connecticut, as well as publicity that comes from service as the backdrop of films such as “Mr. Harigan’s phone” and “Christmas Mystic”.
Ed Cohen, a location researcher and co -founder of the Film Alliance and TV at Connecticut, said the proposal comes at a time when other countries, including New York and New Jersey, are seeking to increase industry stimuli.
“It would be a downfall would be a death knee for any footage in Connecticut,” Cohen said. “The manufacturer, his first consideration when deciding where he can film is” where will I get the best tax credit? “”
After presenting the morning budget, the Governor delivered a speech to lawmakers, in which he mentioned little his plans to eliminate existing tax loans and lids on corporate entities. He chose to focus on other tax proposals that would benefit from the biotechnical sector and starting businesses.
He also revealed a new proposal that would cost millions of dollars in excess funds on an asset to help subsidize children’s care costs that can keep some parents outside the workforce.
Dipetima said CBIA members are in support of the Governor’s plans to create a fund to help subsidize children’s care in the state. In the association’s survey in 2024 for Connecticut businesses, 60% of employers said children’s care had to be expanded to attract and maintain capable workers in the state.
The burden of child care falls especially difficult for women. CBIA stressed that there were nearly 10% fewer women who participated in the Connecticut labor market compared to men.
“Businesses need their youngest employees with family again at work, and our donation will meet the trust fund created by the legislature for the business contribution to the child’s care,” Beckham said while presenting the Governor’s budget.