(HARTFORD, CT) – Governor Ned Lamont on June 5, praised an agreement reached with the leadership of the Connecticut General Assembly on the state budget for Fiscal Year (FY) 2024 and FY 2025. This agreement includes the largest income tax cut for working and middle-class individuals and families in Connecticut history, provides significant increases in funding for K-12 and childcare programs, builds thousands of new housing units, and increases support for nonprofit providers. The General Assembly is expected to vote on this agreement prior to midnight on June 7.
“This budget will deliver the largest personal income tax cut in the state’s history,” Governor Lamont said. “This is not a temporary tax cut – it is designed to be sustainable for years to come. At the beginning of the legislative session, I promised that this budget would build growth and opportunity for all of Connecticut, and this agreement does just that. We are also making historic investments in K-12 education and housing – opening the door to homeownership for thousands of families and increasing funding for nonprofit service providers. I thank the leadership of the General Assembly for their assistance in crafting this transformational budget and I urge members to support it.”
“The broad-based middle-class tax relief included in this budget agreement is the direct result of the fiscal guardrails that have transformed our fiscal outlook over the last five years and that were extended earlier this session unanimously,” Office of Policy and Management Secretary Jeffrey Beckham said. “Governor Lamont has been clear about what he wanted to see in this budget – sustainable and broad-based tax cuts, adherence to the fiscal guardrails, and sustainability in the outyears. This budget accomplishes those goals, providing predictability and stability for essential services in future years.”
The agreement includes:
Tax Relief
- Reduces the state income tax by lowering the 5.0% rate to 4.5% and the 3.0% rate to 2.0% for the income year 2024. The benefits will be capped at $150,000 for single filers and $300,000 for joint filers.
- One million tax filers will benefit from the rate cuts – nearly 60% of all filers.
- 82% of the benefit will go to filers making less than $150,000.
- Increases the Earned Income Tax Credit from 30.5% to 40%.
- 211,000 filers will benefit from the EITC increase.
- Eliminates retirement income tax cliff by adding a phase-out for allowable pension and annuity and IRA distribution deductions against the Personal Income Tax.
- Total personal income tax relief between the above three items is approximately $460.3 million.
Original source can be found here.
