Fazio Announces Largest Middle-Class Tax Cut in Connecticut History
Plan would deliver more than $2,500 of tax relief for the average family per year
Connecticut families are paying too much, and after eight years of Ned Lamont, they are getting less for it. Governor Lamont has increased taxes and fees by hundreds of millions of dollars while blowing through the spending cap. Connecticut does not have a revenue problem. We have a spending problem, and we have a government that has become too comfortable reaching into the pockets of taxpayers.
Under Lamont, Connecticut has enacted or extended a range of taxes, fees and tax increases, including:
- Paid Family and Medical Leave payroll assessment
- Higher taxes on digital downloads and electronically delivered software
- Higher taxes on prepared foods and restaurant meals
- Higher alcohol excise taxes
- Single-use plastic bag charge
- New taxes on e-cigarettes and vaping products
- Expanded sales tax on parking services
- New sales taxes on dry cleaning and laundry services
- New sales taxes on interior design services
- Repeal of the sales-tax exemption for safety apparel
- Reduction of the pass-through entity tax credit
- Reduction of corporate R&D and Urban Reinvestment tax credits
- Repeated extensions of the 10% corporation business tax surcharge
- New 2.25% conveyance tax on high-value residential property sales
- Continuation and restructuring of the hospital provider tax
- Higher business annual-report filing fees
- Corporate capital-base tax phaseout delays
- Highway Use Fee on heavy trucks
- New nip bottle surcharge
- New adult-use cannabis taxes
- Elimination of the $2.5 million cap on certain combined-unitary corporate tax liability
- Changes to corporate net-operating-loss deductions
Connecticut currently ranks 47th nationally on the Tax Foundation’s 2026 State Tax Competitiveness Index, while another analysis places Connecticut among the states with the highest overall state and local tax burdens.
People are leaving, businesses are struggling, and families are asking how they are supposed to keep up. As governor, Ryan Fazio will deliver the largest middle-class tax cut in Connecticut history, providing over $2,500 of tax relief per year for the average family in our state. This is about giving working families the relief they desperately need and making Connecticut affordable. We can pay for it by eliminating wasteful and inefficient spending, reducing borrowing, ending political spending and making government live within its means.
The plan also calls for full expensing of capital investments to create jobs, property tax relief through the elimination of unfunded mandates, predictable education funding for municipalities, reductions in wasteful spending, lower borrowing, and reforms to tax exemptions and subsidies.
The latest developments surrounding former state budget official Kosta Diamantis, who was convicted on federal corruption charges and recently fled the country before sentencing, highlight another “corruption tax” borne by taxpayers for fraudulent spending.
Every dollar lost to fraud, waste and corruption is a dollar that cannot go toward lowering taxes or making Connecticut more affordable. That has to change.
VIEW THE FULL FAZIO TAX CUT PLAN:
Ned Lamont raised taxes on the middle class by hundreds of millions:
- Ned Lamont increased taxes on your paycheck (Law: PA 19-25)
- Lamont increased taxes on prepared meals (Law: PA 19-117)
- Lamont increased taxes on online purchases and digital downloads (Law: PA 19-117)
- Lamont increased many other fees and taxes on residents and small business over eight years
Altogether, factoring in both positive and negative tax changes the governor has made, Lamont increased taxes by over $400 million per year and $3.7 billion total since 2019.
Connecticut needs tax relief to grow its economy and make Connecticut affordable
- State-by-state tax burdens significantly influence economic growth and population growth. The 15 lowest-tax states gained 2.2% population from 2020-2022, while the 15 highest-tax states lost 1% of their populations
- Income taxes are more determinative of long-term economic growth than sales and property taxes
As governor, Ryan Fazio will deliver the largest middle class tax cut in state history
Ryan Fazio will reduce taxes by over $2.5 billion by the fourth year of his administration with relief focused on income tax relief for middle-income families
Ryan Fazio will cut taxes by over $2,500 per year for an average income family
Ryan will cut income tax rates taxes by 2 percentage points on most families, equating to around $2.5 billion per year
- 2 percent to 0 percent
- 4.5 percent to 2.5 percent
- 5.5 percent to 3.5 percent
- 6 percent to 5 percent
- Full expensing of capital expenditures to incentivize building factories, offices, buying machinery and plants that will lead to the long-term manufacturing and industrial jobs, around $100 million
- Property Tax Cap will mostly be funded by removing unfunded mandates at no cost to the state budget but will also increase ECS funding by over $100 million annualized to help reduce property taxes
Ryan Fazio has a plan to pay for tax relief
- Reduce wasteful and politically oriented spending by about $1 billion per year by 2031
- End Political Earmarks
- Stop Over-Budgeting for Agencies
- Medicaid Fraud and Overpayment Detection
- Program Review and Investigations Savings
- Overtime Assignment Optimization
- Medicaid Managed Care
- DSH Payment Optimization
- Reduce CRDA Subsidy
- Eliminate benefits for noncitizens without legal status
- Delegate some DDS and other services to high-quality nonprofits
- Community Living Arrangements via nonprofits
- End slush funds and use the money to pay down debt to reduce our debt service costs saving over $200 million per year by 2030
- Reduce borrowing by $500 million per year, reducing debt service costs by over $150 million per year by 2030
- Reduce tax exemptions and subsidies in the tax code saving over $300 million more per year
- Apply investment income taxes to multi-billion university endowments, generating over $200 million per year
- Litigate and stop New York’s taxation of Connecticut’s residents working from home, saving over $300 million per year
- End any tax or fee that costs more to collect than it raises in revenue
- Reduce PFML payroll tax by 0.1 percentage points, fully funded by existing PFML reserves and surplus
- Increase spending at roughly 2.5 percent per year otherwise, as per OPM projections, with an expected $800 million surplus under existing OPM projections in FY 2031 before above changes