Connecticut Ranks #21 In Tax Fairness

 From the CT Mirror:

Though Connecticut has eased state and municipal tax burdens on the poor and middle class significantly in recent years, it ranks behind 29 other states and the District of Columbia in one key fairness metric, according to a new report from a liberal Washington-based fiscal policy think-tank.

The Institute on Taxation and Economic Policy report ranked Connecticut’s tax system the 21st most regressive, meaning the poorest households pay the greatest share of their income and the richest pay the least.

It’s one of 44 states with an overall tax system that worsens income inequality, according to ITEP; one of 41 that imposes the lowest rate on the top 1% of earners, and one of 34 that imposes the highest rate on its poorest.

But in their 7th periodic “Who Pays” analysis of states’ tax burdens, ITEP analysts cited two areas that legislators and Gov. Ned Lamont recently made more progressive: lower state income tax rates for the middle class and a larger income tax credit for the working poor.

“The vast majority of state and local tax systems are regressive, asking less of the wealthy than of low- and middle-income families,” ITEP analysts wrote, noting “These systems worsen income inequality by making incomes more unequal after collecting state and local taxes.”

These systems also exacerbate longstanding racial gaps in economic and educational opportunities, as well as access to affordable housing and health care. Black and Hispanic families nationally earn around $35,000 less in income every year, at the median, than do white families, the report states.

Among the chief culprits fostering an unfair system, according to the report, are property taxes — usually levied at the municipal level — and sales taxes, levied at either the state or local levels.

Property tax rates, according to state law, generally are not affected by the owner’s income or ability to pay.