New child tax credit could be included in budget negotiations – NBC Connecticut

After a report this week showed Connecticut’s budget surplus hit all-time highs, lawmakers now agree it’s time to put money back in your pocket with tax relief.

But determine how the two parties disagree.

“What we’re doing is we’re taking the overcollection of sales and use tax and gross receipts tax that those funds that we didn’t anticipate and we’re giving that back to the taxpayers. We received that, the state receives it because of inflation, and what we’re doing is just giving that back to the taxpayers, so it doesn’t affect the budget, it’s budget neutral in that sense. The budget is balanced, and in fact in surplus, so that’s responsible,” said Sen. Kevin Kelly (Borough R-21e).

Now Republicans are talking about possible tax breaks for people earning less than $75,000, extending the gas tax exemption, scrapping the tax on restaurant meals, as well as a list other proposals.

The Democrats also have their own plan.

NBC Connecticut’s Mike Hydeck spoke with House Speaker Matt Ritter (D-Hartford) about the matter. Ritter is at the center of budget discussions.

mike hydeck“So let’s start with the comments of Senate Republican Minority Leader Kevin Kelly. He says their $1.2 billion relief package is budget neutral. Is that, in your opinion?”

Matt Ritter“To me, that’s not even the relevant point, it’s illegal. That’s the biggest problem. So, actually, I would support a lot of the tax cuts they’ve come up with. The problem is due to federal government rules for states that have received ARPA funding, we are limited in Connecticut to a $400 million tax reduction for fiscal year 2023, so fiscal year beginning July 1 , that number goes from $180 million to $400 million, so the Legislature can cut taxes by $400 million starting July 1, 2022. We intend to do that. would violate federal law. And what would happen is that you might have to pay for the federal grants that we received. So their proposal was illegal under federal law.

mike hydeck“What is your party’s biggest tax relief priority? Would you say it was property tax or gas tax or car taxes?”

Matt Ritter“They’re all part of it, right? So those are three things you mentioned. And you’ll see them in the budget. The one that’s very close to our hearts is the continuation of the child tax credit that you’ve seen the federal government do over the last two years And given the news that literally just broke in the last 24 hours that we can now increase our tax cuts by $180 million to almost $400 million, I think you’ll see a very big push from Democrats and Republicans will include a child tax credit in the next budget, which is expected to be about $250 per family per child, up to three children and, of course, means-tested by income limits, which will help many middle-class families with children, so I think you’re going to see a lot of reductions. , if you have a child, if you own property, you’re going to see tax cuts.

mike hydeck: “How and why did it go from 180 to 400?”

Matt Ritter“You’ve got so much more money coming in. So it’s a formula, right? And so when they were able, we didn’t expect to see another billion dollars of additional new revenue and surplus funds And so that allowed us to increase it, that’s kind of a ratio that the OPM has to calculate, and that’s where the money came in.

mike hydeck“So one thing you seem to disagree with – we’ll come back to the child tax credit – is that you would like this to happen sooner rather than later. The Governor has a different opinion. How about do you come to some common ground?”

Matt Ritter“Well, the governor really wanted a property tax credit, which we prioritized. He had some things in the budget that he wanted. So it’s all a conversation. I think the governor maybe had more reserves, I won’t speak for him, while we thought we were capped at $180 million, we would have been unable to afford that a week ago under the ARPA calculation. I hope he will be a little warmer to the suggestion now that we have a little more room given the new revenue estimates we have received.”

mike hydeck“So you just mentioned that. Because of the exponential difference between what we expected to have in state coffers and what we literally have, billions more than expected, will this debate be t does it actually settle later in this session, because we have very little time left in this session. And if not, what happens next?”

Matt Ritter“Yeah, listen, I like to go eight miles a minute. So believe me, sometimes I get frustrated with how these things slow down. But now you can see why you can’t finalize a budget until you don’t get the final income figures, that’s right. If we had voted a week ago, we would have been like, ‘Oh boy, that’s a lot more than we thought.’ why we have to be patient and follow the timeline in the law for the due date of these reports. But yes, we will get there. I think we will have an agreement on Monday, and I think the budget will be bipartisan. I know that really. I don’t know how you can vote against some of the things that we’re doing on the tax cut side. So I think when it’s all said and done you’ll see Republicans and Democrats both voted yes on this which is a year two budget adjustment, not a new budget. “

mike hydeck: “So you’re not planning any special sessions coming up or throwing things on the road to the next session?”

Matt Ritter: “I’m planning my summer to go back to work and coach my son’s baseball team, without being in special session, that’s right.”

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