Copyright Hartford Courant
Saying taxpayers are strapped for cash, Republican legislators proposed Tuesday to more than triple the state’s property tax credit to $1,000 per year. Lawmakers want to sharply boost the maximum credit, which is currently $300 per tax return, and expand the eligibility to wealthier couples. A partial credit of $400 would be available to married couples filing jointly and earning as much as $200,000 per year, according to the plan. Currently, couples earning more than $130,000 are not eligible for any credit and those earning between $120,500 and $130,500 receive only $30 per year. House Republican leader Vincent Candelora of North Branford said increasing the eligibility is good policy at a time of rising costs statewide. “A family of four earning $200,000 certainly isn’t rich, and should have the ability to have some sort of tax relief,” Candelora told reporters at the state Capitol complex in Hartford. One of the problems, lawmakers said, is that homeowners in multiple towns are facing rising property taxes due to revaluations that often shift the taxes away from businesses and instead transfer them to homeowners. In addition, residents pay taxes on their cars that they say are often too high. What you should know about Connecticut property revaluation. Why there are both ‘winners and losers’ The issue will become more acute, Candelora said, in places like Hartford because many of the tall office towers have high vacancy rates since companies have consolidated their office spaces and many employees are working at home several days each week. That shift in the tax burden will put pressure on residential homeowners in areas like the city’s West End. The Hartford rates will be established on property assessments as of October 2026. “Hold onto your hats when Hartford goes through reval, and you see the shift of commercial to residential,” Candelora said. Gov. Ned Lamont’s chief spokesman, Rob Blanchard, said Lamont is generally supportive of the idea. Last year, Lamont proposed an increase of $50 in the property tax credit, but that was rejected in the final compromise as negotiators crafted the two-year, $55.8 billion state budget. “Governor Lamont is supportive of policies or ideas that make life more affordable and reduce burdens on middle-class and working families, and that includes through property tax relief while also supporting key social service programs, such as WIC, SNAP, and health coverage that have unfortunately been impacted by Republicans in Congress,” Blanchard said. “Governor Lamont enacted the largest income tax cut in Connecticut history, and he wants to continue on that path. Additionally, he appreciates House Republicans thinking about this issue, despite their counterparts in the Senate launching an affordability tour six months ago that hasn’t yielded any ideas at all.” The tax credit would cost the state $500 million per year in lost revenue, which is the same amount that Democrats have been talking about to set aside in the wake of expected federal budget cuts by the administration of Republican President Donald J. Trump. The money would be taken from the so-called “volatility surplus,” which is extra money collected through the state income tax due to capital gains as the stock market has continued to break records on Wall Street. The Dow Jones Industrial Average broke another record Tuesday. Connecticut is reliant on Wall Street and the capital gains that are collected by millionaires and billionaires in Fairfield County. Republicans oppose setting aside an estimated $500 million to cover federal budget cuts, saying the state’s $4.3 billion rainy day fund is already sufficient to cover fiscal emergencies. Republicans said they intend to offer an amendment during the special session to force a vote on how to spend the $500 million. “I am pleased to see House Republicans recognize the Trump Administration has created a fiscal emergency that must be addressed in special session,” said House Speaker Matt Ritter of Hartford. The session is currently set for Nov. 12 and 13, but the final wording of the bills has not been completed. Senate Republican leader Stephen Harding of Brookfield blamed Democrats for the high cost of living in Connecticut because they control the governor’s office and both chambers of the legislature. “Working families and job creators are getting crushed by rising costs, and onerous property taxes are a big part of our affordability problem under one-party rule,” Harding said. “We thank our Republican colleagues in the House for once again highlighting affordability, as one-party Democrat rule here in Connecticut continues to do nothing but drive up taxes and fees on our constituents and small businesses.” Senate President Pro Tempore Martin Looney, a New Haven Democrat, said recently that the most problematic levy in the state is the property tax. “The Republicans always say that taxes in Connecticut are too high, but they never point out the reality that none of the taxes directly levied by the state of Connecticut are high,” Looney said recently. “The tax that is high is the local property tax, and the reason that is high is that the state doesn’t generate enough revenue from the state income tax in order to really provide the high level of municipal aid that would allow municipal property taxes to be lower.” Since the grand lists and tax rates are sharply different, Looney pointed to homes in Greenwich and New Haven that both pay $24,000 per year in property taxes. The Greenwich home has a market value of $3 million and an assessed value of $2.1 million, while the New Haven home has a market value of only $875,000. But since the local tax rate is higher in New Haven, the two homeowners pay the same amount of annual property taxes. Republicans, Candelora said, have been concerned about property taxes and have pushed for increasing a popular tax credit that is taken by many homeowners who deduct it from their state income tax. “It was not the Republicans. It was the Democrats that took away the property tax credit,” Candelora said recently. “I completely share [Looney’s] sentiment, but I disagree with his argument that Republicans don’t talk about it enough. … I guess I look forward to working with Senator Looney on this issue.” If approved by the full legislature and Lamont, the $1,000 credit would be the highest in state history. The credit peaked at $500 per tax return under Republican Gov. M. Jodi Rell, and the total has gone up and down under the past four governors as it followed the state’s budget fortunes with increases during times of surplus and cuts during years of deficits. By 2022, the credit was reduced to a maximum of $200 with additional cutbacks in eligibility so that only senior citizens and those with dependents were eligible for the credit. The credit and eligibility were changed again with the maximum now at $300 per tax return and subject to certain income limits. The affordability, Candelora said, impacts a wide range of ages and income levels, from recent college graduates trying to make the rent to couples trying to purchase a home. In his hometown of North Branford, Candelora said that the property taxes on his home were $9,500 per year before a recent revaluation. Now, his taxes are suddenly $11,800 per year, representing a shift to residential property that often happens with a revaluation. The impact has rippled throughout the community in the same way as other towns across the state. Christopher Keating can be reached at ckeating@courant.com
