Finance Committee Stops Anti-Business Bill
The legislature’s Finance Committee last week voted overwhelmingly to stop a bill that would have imposed a new punitive tax on many Connecticut businesses.
Under HB 5069, employers with 500 or more employees, or franchisors whose franchisees collectively have 500 employees would have been taxed $1 per hour for each hour worked by employees paid less than 130% of the minimum wage.
According to the legislature’s nonpartisan fiscal office, HB 5069 would have caused $104 million in business fines in its first year and up to $222 million in fines in the second year.
But after a lengthy discussion, the Finance Committee defeated the bill by a bipartisan, 27-16 vote (with 11 absent). CBIA applauds the members of the committee who voted to reject the proposal.
HB 5069 would have been extremely costly for Connecticut businesses, especially coming on the heels of lawmakers’ approval of increasing the state’s minimum wage to become the highest in the nation in 2017.
The proposal also would have made hiring young and low-skilled employers more cost prohibitive during a time when Connecticut’s teen unemployment rate is nearly 23%.
Several national economic competitiveness studies cite Connecticut as a high cost state in which to do business—despite the state’s many virtues, including a great education system and quality of life.
Although the studies often are subjective, businesses across the country pay attention to them when they make decisions on where to locate or grow their operations.
Imposing a new and punitive tax on employers—even those already paying employees up to 30% higher than the state’s minimum wage—would have affirmed Connecticut as a high cost and less competitive state.
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