Wide range of tax proposals up for discussion in Finance

(March 20, 2008) Many proposals of great interest to the business community — including those that concern taxpayer rights and property taxes — are subjects of a public hearing by the legislature’s Finance Committee on Monday, March 24, and at which CBIA will testify.

State tax policy directly affects the decisions Connecticut employers have to make every day about job creation or business expansion. With an economic downturn at our doorstep, it’s critical that lawmakers adopt tax policies that will encourage businesses to create jobs and expand here.

Tax policy has a significant impact on a state’s ability to compete in a global economy and lawmakers have a variety of proposals before them this year. Some of these measures would help businesses succeed, others would hurt their ability to compete.

For example, a proposal such as SB-702 can help by reversing the erosion of taxpayers’ administrative and judicial rights, thereby clarifying state tax policy and improving how businesses interact with the Department of Revenue Services. But SB-701 can hurt by shifting more of the property tax burden on employers. 

Here is a brief look at some of the most important measures to be discussed at the public hearing:
 
Taxpayer rights
SB 702 – intends to reverse the erosion of taxpayers’ administrative and judicial rights and remedies by, in part, confirming several matters including:
• defining what constitutes “intent to evade”
• specifying in statute that the standard of proof in an appeal to the Tax Session of the Superior Court from a determination made by the Commissioner of Revenue Services is the “preponderance of the evidence”, and not “clear and convincing evidence”
• ensuring proper notice to taxpayers and their representatives
• ensuring the privacy of data that must be shared with the state tax department. 
(CBIA supports, with change in the effective date)

HB-5930 — requires the Department of Revenue Services to follow all protocols for taxpayer data protection issued by the Department of Information Technology, and requires municipal tax collectors to notify people who are entitled to a refund of excess property tax payments. (CBIA supports)
 
Property taxes
SB-701 — shifts more of the property tax burden to businesses by exempting from property tax the first $100,000 of the assessed value of most single-parcel owner-occupied residential real property. (CBIA opposes)

HB-5928 — caps residential property taxes at no more than 6% of a resident’s income, and requires the state to grant the town additional funds to cover the loss of revenues. (CBIA opposes)

HB-5936 — grants a property tax exemption to owners of buildings using energy-saving heating and cooling systems.  (CBIA supports)
 
New or increased taxes
HB-5929 — allows municipalities to adopt local ordinances imposing sales, property or income taxes. (CBIA opposes)

HB-5940 — increases the sales tax to 6.5%, provides sales tax revenue to regional councils of government for the regional incentive program and to increase the carry-forward period for donations of land for open space. (CBIA opposes)

For more information about these proposals or the hearing, contact CBIA’s Bonnie Stewart at 860-244-1925 or StewartB@cbia.com.