The devil’s in the details, as they say — so it remains to be seen exactly what will, and will not, be in the final version of the sweeping tax reforms that will wind up on the president’s desk after the separate bills that have been passed by the House and Senate have been reconciled. But a number of senators, including Connecticut’s Dick Blumenthal and Chris Murphy, have denounced the Senate version as a giveaway to the wealthy.
“The idea that you finance a tax cut for the rich … and that it will trickle down, that is not true. You might as well believe that unicorns are real,” Murphy told The Connecticut Mirror.
And the lower tax rates for individuals are temporary, ending in 2026, while the corporate tax rate cuts are permanent.
“It’s a classical bait and switch,” Blumenthal said.
The senators also complained that the bill was crafted “in the dead of night,” with Democrats excluded from the process.
More specifically, the two Nutmeg State Democrats lit into the measure as particularly hard on taxpayers in high-tax states such as Connecticut. The bills would also eliminate a new tax break for homeowners in the state who have crumbling foundations because of the use of substandard concrete.
Yes, the bills do lower tax rates for individuals, as well as corporations. But unless the traditional deductions for state income taxes and local property taxes — which so many taxpayers in high-tax Connecticut and many other “blue” states have come to rely on — find their way into the final version of the bill, many thousands of middle-income families in this state will be hit hard. Some Republicans counter that such deductions are unfair to taxpayers in low-tax states, which are generally “red” states.
Whether the Republicans — who control both houses of Congress as well as the White House — are using tax “reform” to punish the states that didn’t vote for the president last year is a matter of conjecture. But the proposed changes from Washington come at a time when Connecticut taxpayers are already dreading the threat of likely local and state tax increases caused by the chronic budget shortfalls in Hartford.
People in the real estate industry, and some homeowners, also fear that changes to mortgage-interest deductions could lead to a drop in house values statewide.
What is not a matter of conjecture is that, unless certain changes are made, Connecticut will be getting a big lump of coal in its stocking from Santa Claus this year.