by Fergus Cullen, MPA, Executive Director of the Yankee Institute for Public Policy
Published on May 20, 2009 by the Yankee Institute for Public Policy
EXECUTIVE SUMMARY:
As Governor M. Jodi Rell and the General Assembly seek to close the existing state budget deficit and adopt a balanced budget for the next fiscal biennium, various proposals call for increasing taxes on the affluent. Several groups argue the wealthy aren’t paying their “fair share” of taxes.
However, a new Yankee Institute study of who pays Connecticut’s state income tax reveals that:
• The top 20 percent of Connecticut income earners – those who make more than $100,000 a year – already pay 80 percent of state income tax receipts.
• The top 6 percent of filers – those over $250,000 – pay half of all state income taxes.
• The top 1.3 percent of taxpayers – those earning more than $1 million – pay 35 percent of total income tax receipts, or more than $2.1 billion in 2007.
The bottom 60 percent of Connecticut taxpayers – those with incomes under about $60,000 – paid less than 10 percent of state income taxes, and the bottom 40 percent of all filers – those with incomes of less than $35,000 – effectively paid no state income taxes.
