Connecticut sales tax proposal pits municipalities against nonprofits

Hartford Mayor Luke Bronin

Hartford Mayor Luke Bronin

HARTFORD >> The state’s largest organization of local leaders Wednesday came out in support of a plan to raise the state’s sales tax rate from 6.35 percent to 6.99 percent as long as the increased hundreds of millions generated would be sent back to the municipalities.

The Connecticut Conference of Municipalities says the increase in the sales tax rate could provide an estimated $440 million to towns and cities.

That’s if the state collects the sales tax and then redistributes it to cities and towns without taking a cut.

CCM’s Executive Director Joe DeLong said the organization supports the tax hike to boost revenue and reduce dependence on a regressive property tax system.

However, the group’s support is “contingent on other important cost control measures being adopted by the General Assembly,” DeLong said.

“We need to have cost containment” along with a sales tax increase to prevent additional money coming in “being spent like we’re drunken sailors,” he added.

Betsy Gara, executive director of the Council of Small Towns, said her organization supports the legislation because “property taxpayers have had a bullseye on their backs” for too long and increasing the sales tax is “a fairer plan.”

Nonprofit organizations are opposing the bill because it would eliminate the sales tax exemption on goods and services provided by nonprofit organizations. It would cost them about $216 million a year.

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