Equitable tax policy needs to be part of Connecticut’s budget, children’s group says

Back • Publication Date: December 15, 2022 • Fiscal & Economics

Connecticut Voices for Children wants the state government to fund a child tax credit to work toward fixing racial, ethnic and class tax inequality.

Dr. Patrick O’Brien, the group’s research and policy director, said income inequality exists “pre-tax” in the state and is made worse by tax revenue and spending systems.

“The average wealthy family had a pre-tax income that was more than 40 times greater than that of the typical middle-income family and more than 160 times greater than that of the typical low-income family,” O’Brien said. “The second key finding is that pre-tax racial and ethnic income gaps decreased in Connecticut last year, but the state still has substantial gaps that tend to result in higher levels of income inequality for families of color.”

Connecticut has the third highest income and wealth inequality in the country.

According to Connecticut Voices for Children, the typical low-income family pays almost 26% of their income in taxes, while the typical wealthy family only pays 7%.

The group wants to see more state-funded help for middle and low-income families instead of overpaying for long-term obligations, like pensions.

One of these programs, they said, is a child tax credit.

The group said by increasing taxes on the wealthy, Connecticut could create a permanent child tax credit for $280 million a year.

State House Speaker Matt Ritter said he thinks Connecticut is financially stable enough to fund it.

“We have to find the right amount of relief to provide that helps working families now, and is real, but also not sacrifice the future in doing that,” Ritter said. “And I think we are in a position where we can do both. I am not sure we were in that position 12 years ago.”

Authors: Molly Ingram •  Source: WSHU • View