Governor Ned Lamont Surprises Connecticut With Good News

Governor Ned Lamont recently announced the largest income tax cut in Connecticut history...

Photo byOffice Of Ned Lamont via Wikimedia Commons

Governor Ned Lamont recently announced the largest income tax cut in the history of Connecticut.

“The reason why I am able to sign a budget today that implements the largest cut ever made to Connecticut’s income tax is because of the fiscal discipline that we implemented over the last several years to stabilize our fiscal house and end what has been too many years of uncertainty and deficits,” Governor Lamont said. “We targeted these tax cuts and credits specifically for middle-class and working-class taxpayers because we want to enact the broadest-based relief possible to those who need it. I am glad to sign a bill providing tax relief to our residents.

“I am particularly proud that we were able to negotiate and pass this budget in a bipartisan manner with both Democrats and Republicans actively participating,” Governor Lamont added. “I am fully aware that this makes Connecticut an outlier among the states in this current political climate and I don’t take that for granted. By working together collaboratively, we are making Connecticut stronger and adopting policies that benefit the people who live here. I thank the legislative leaders on both sides of the aisle for their work on this biennial budget.”

According to an official press release by Governor Ned Lamont, the income tax relief measures include:

• A middle-class income tax cut that lowers the two lowest marginal rates. The 3% rate on the first $10,000 earned by individuals and the first $20,000 earned by couples will be reduced to 2%. The 5% rate on earnings over $40,000 for individuals and $80,000 for couples will be reduced to 4.5%.
• An increase in the Earned Income Tax Credit for low-income workers from 30.5% to 40% of the federal credit. The Earned Income Tax Credit (EITC) is a refundable state income tax credit for low-income working individuals and families that is equivalent to the federal credit. This change will result in an additional $44.6 million in state tax credits being distributed to an estimated 211,000 low-income taxpayers.
• Extending existing exemptions on certain pension and annuity earnings to help seniors. The budget, in particular, eliminates the retirement income tax cliff by introducing a phase-out for allowable pension, and annuity and IRA distribution deductions from personal income tax.

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