• Connecticut Budget Act and Pending Tax Legislation
  • May 25, 2011 | Authors: Christine E. Bromberg; Felicia S. Hoeniger; Scott E. Sebastian; John R. Shaughnessy; Richard W. Tomeo
  • Law Firm: Robinson & Cole LLP - Hartford Office
  • Facing an estimated $3.5 billion budget deficit, both chambers of the Connecticut General Assembly recently approved a modified version of Governor Dannel Malloy's original budget proposal. The $40.2 billion budget for fiscal years (FY) 2012 and 2013, signed into law by Governor Malloy on May 4, 2011, seeks to address the budget deficit, in part, by increasing a variety of taxes, including the individual income tax, the sales and use tax, and the corporation business tax. The legislative Office of Fiscal Analysis projects these measures will generate approximately $4 billion in additional revenue for the FY 2012-2013 biennium, representing the largest tax increase in state history. The administration has recently announced an agreement with state employee union negotiators that would produce an additional $1.6 billion in savings over the next two fiscal years. While this falls short of the $2 billion in savings the governor had sought, Governor Malloy reports that he will eliminate the remaining $400 million deficit without further raising taxes.