Only three other states tax as many business services as the Finance Committee’s proposal—and Connecticut really doesn’t compete with any of them: New Mexico, South Dakota and Hawaii.

Michigan, with whom we do compete, passed a similar bill—and repealed it within 17 hours. Because they immediately saw what a very bad idea it was.

Yet SB 946 taxes more than two dozen business services—from accounting to veterinary services, from building inspections to management consulting—that will affect every business, every consumer, every day in Connecticut.

We’ll see taxes on:

  • CPAs
  • Accounting services
  • Architectural services
  • Computer and data processing services
  • Engineering services
  • Drafting services
  • Building inspection services
  • Geophysical and other surveying and mapping services
  • Interior design services
  • Industrial design services
  • Other specialized design services
  • Administrative management and general management consulting services
  • Human resources consulting services
  • Marketing consulting services
  • Process, physical distribution, and logistics consulting services
  • Other management consulting services
  • Scientific and technical consulting services
  •  Direct mail advertising services
  • Advertising material distribution services
  • Marketing research and public opinion polling  services
  • Translation and interpretation services
  • Veterinary services
  • All other professional, scientific, and technical services
  • Golf courses and country clubs
  • Dry cleaning and laundry (except coin–operated)

Add it all up and it comes to a net tax increase of $1.43 billion over the next two fiscal years (with $701 being diverted to municipalities)--assuming, of course, that the post-tax level of services activity will equal the pre-tax volume.

And CBIA believes that the cost of this tax package will be significantly higher than estimated.

The tax hike will also cost Connecticut in other ways, including lost jobs, a weakened economy, and higher prices for services.

CBIA urges lawmakers to reject these tax hikes and instead work on ways to build up, not jeopardize, Connecticut jobs.

For more information, contact CBIA’s Bonnie Stewart at 860.244.1925 | bonnie.stewart@cbia.com | @CBIAbonnie