House votes to lay groundwork for tax overhaul debate

The state House voted Wednesday to lay the groundwork for what could be a complete overhaul of the state’s tax system by ordering a comprehensive study of the existing revenue structure–the first since establishment of the state income tax nearly 20 years ago.

“There is precedent do exactly this the last time we faced a huge deficits, and that was in 1991 where a commission was created to look at the revenue that solved the problem at the time,” said House Majority Leader Denise W. Merrill, D-Mansfield. “That’s just what we are going to need again.”

Legislators are predicting this study will set the stage for a tax debate next session reminiscent of the 1991 battle that produced the state income tax.

“I think this study before us will help us next session,” said Rep. Cam Staples, D-New Haven, co-chairman of the legislature’s tax-writing committee.

Republicans voiced opposition to the bill, pointing to language directs the Revenue Accountability Commission to make recommendations “as necessary to raise the revenue sufficient to balance the budget.”

Rep. Craig Miner, R-Litchfield, co-chairman of the Appropriations Committee, said the state should be reducing costs, not erecting plans to raise taxes.

“There is no doubt about it, the language is very clear, this is going to raise revenue to close the gap,” he said.

But Merrill said the next governor and legislature need the data to make decisions as they face multi-billion deficits.

“We simply don’t have the information to know who’s paying, how much and what that revenue is doing for us or whether it really is harming businesses. … We need the data,” she said.

The bill passed the House 106-37 and now heads to the Senate for final passage.