|Business News Links|
Business Moves with Building Sale
|Twin Facades of Corporate Assistance|
|Craft Beer Keeps Brewing in CT|
|Builders Say Too Many Regs|
|Pro Business Efforts in Legisalture|
State, local income taxes consume 12% of Nutmeggers’ income
A new report places Connecticut third among states with the highest tax burden.
Residents shelled out more than one-tenth of their income — 11.9 percent — to pay state and local taxes in 2011, according to the Tax Foundation, a policy research organization based in Washington, D.C.
That is well above the national average of 9.8 percent, according to Elizabeth Malm and Gerald Prante, authors of the report.
“Since 2000, state-local tax burdens as a share of income have grown slightly, from 9.5 percent to 9.8 percent in 2011,” Malm and Prante report. “During that period, however, there has been some slight fluctuation. From 2005 to 2010, burden as a share of income slowly increased, hitting a high of 10.2 percent in 2010 and dropping to 9.8 percent in 2011.”
The April report, titled “Annual State-Local Tax Burden Rankings FY 2011,” is based on Census information as well as other data.
The Tax Foundation releases a comparative report of state income tax payments each year. Connecticut has placed in the top three each year since 2005. New York and New Jersey, which were No. 1 and 2, respectively, for 2011 residential taxes, also have held one of the top three slots since 2005. In addition, authors of the report say the three states stand out from the rest of the nation because of their relatively high tax burdens.
“The residents of three states stand above the rest: New York, New Jersey and Connecticut,” report the authors. “These are the only states where taxpayers forego over 11.9 percent of their income in state-local taxes, one half of a percentage point above the next highest state, California.”
Authors calculated tax burden by adding state and local taxes paid by residents, then dividing those totals by each state’s total income. The emphasis was on taxes paid by residents, not taxes collected by the state. For example, New York taxes paid by a Connecticut resident working in New York would count towards the Connecticut tax payment, since it is part of the Connecticut resident’s total payments for state/local taxes.
“Nationwide, over a quarter of all state and local taxes are collected from nonresidents,” Malm and Prante note. “As a result, the residents of all states pay surprisingly high shares of their total tax burdens to out-of-state governments.
The report listed Wyoming as the state with the lowest tax burden for residents, 6.9 percent. That state’s per capita income is $50,805.
Connecticut’s per capita income is $60,287, highest in the nation, according to the report.
HARTFORD — One of the last-second laws approved by the General Assembly as the 2014 legislative session expired was a measure that eliminates the fee for a business entity registered with the state to dissolve as of July 1, 2015. The bill passed the state House by a vote of 140-0 on May 2 and was approved by the State Senate on the consent calendar as the 2014 legislative session expired May 7, 2014.
If signed into law by Gov. Dannel P. Malloy, the bill will restore the authority of the Secretary of the State to administratively dissolve a business entity that has not complied with state laws to file annual reports for at least one year. It gives the Secretary of the State the authority to administratively dissolve any non-stock (non-profit) corporation after two years of failure to comply with the legal requirement to file annual reports.
The bill’s goal is to clean up the database of businesses registered with the Secretary of the State’s office, reducing the number of listings from defunct businesses and encourage companies that have long since gone out of business to take the legal step to dissolve their corporation.
Having thousands of defunct companies listed as active in our public database harms consumers and also leaves those businesses on the hook for years of back payments for the state business entity tax,” said Secretary of the State Denise Merrill.
J&B charged with flouting wage laws
NEW HAVEN — J&B Deli, 1147 Chapel Street, was issued a stop-work order by the state’s Department of Labor in March for allegedly failing to comply with wage laws.
A DOL investigation concluded that deli operators John and Cheong Rhee violated statutes include not paying minimum wage or overtime, paying workers in cash, failure to make legal deductions, and failure to maintain payroll records.
“This is a case where an employer is taking unfair advantage of their employees and also cheating the state by not paying the proper taxes or protections, such as unemployment insurance and workers compensation,” said state Labor Commissioner Sharon Palmer in a department release.
The order was issued by DOL’s Wage & Workplace Standards Division. An investigation was launched after two employees claimed they worked about least 60 hours per week but were not paid at least minimum wage or overtime. Other findings surfaced after that initial complaint.
Palmer said such alleged practices are “a loss for our entire state” and upsets its economic equilibrium.
“While we want to keep Connecticut’s economy strong and help employers stay in business, our first obligation is to ensure that people are paid fairly for the work they do, and have the proper protection should they get injured while on the job,” Palmer stated. “Only by creating a level playing field can we help those employers that are doing the right thing to remain competitive.”
Companies that violate state wage laws can be fined $300 for each week an employee has worked while not on the payroll.
NEW HAVEN — The Women’s Business Development Council (WBDC) is accepting applications for its “Passion to Profit” business plan-development program in New Haven. The program will begin on April 28 at the Greater New Haven Chamber of Commerce, 900 Chapel Street.
Passion to Profit is WBDC's business plan-writing program, which is designed to help emerging and aspiring entrepreneurs transition from an idea to a workable plan for new levels of business growth.
Over a nine-week period WBDC's business instructors provide guidance, support, resources and motivation to a small group of like-minded entrepreneurs. In addition, each entrepreneur can access an interactive Web tool that features a step-by-step process to draft and complete a professional business plan.
Registration and materials fee is $300. (Reduced-fee scholarships are available for those who qualify based on income guidelines.)
Founded in 1997, the Women's Business Development Council is a non-profit organization dedicated to helping women achieve economic equity through entrepreneurial training, financial education and professional development. The provides education, training, resources and connections to women (and men) at training sites statewide, offering a continuum of programs and services to its clients in need.
More information about the group is available at ctwbdc.org.
Business groups opposed state-run IRAs for private firms
HARTFORD — The Senate and House majority leaders are pushing legislation that would create a state-run retirement program for private-sector employees over the opposition of insurers and private investment advisers.
On March 11 Senate Majority Leader Martin Looney of New Haven and House Majority Leader Joseph Aresimowicz of Berlin urged passage of legislation that would make Connecticut the second state after California to offer a state retirement trust program.
The two Democratic leaders acknowledged that California has yet to resolve key questions about its program, including whether it would enjoy the same tax advantages to savers as 401(k) or individual retirement accounts.
The goal is to offer a low-cost retirement savings program that could be offered as a payroll deduction plan to Connecticut workers who lack access to retirement programs through their jobs.
“One of the things we’ve seen, unless there are payroll deduction plans offered, the level of participation is very low,” Looney said. “That’s why I think a payroll deduction component of this is critical.”
Aresimowicz said the average Social Security benefit in Connecticut is about $15,000. Too many residents have no retirement plan other than Social Security, a program created in 1935, when the average life expectancy was 62.
“Our senior population is going to be doubling within the next 10 years, and we’re going to continue to have to provide services for these folks,” he said.
AARP says more than 600,000 workers in Connecticut have no access to a retirement plan. For those 65 and older, Social Security accounts for 87 percent of total income for low-income households and 70 percent of middle-income households.
Looney and Aresimowicz could not precisely predict what the program would cost the state. The goal is a program the state could run for administrative fees of no more than 1 percent.
“What we’re saying is let the state of Connecticut provide this product,” Aresimowicz said.
Looney said the program would be self-sustaining and low-risk with a moderate rate of return likely tied to the 30-year Treasury bond rate.
Treasurer Denise Nappier and Comptroller Kevin Lembo have endorsed the concept, but the bill is opposed by the Middlesex and Windham chambers of commerce, the Insurance Association of Connecticut and the National Association of Insurance and Financial Advisors.
The legislation would put the state in competition with private savings plans, and businesses say that administering a payroll deduction system would impose a cost on them.
“Connecticut already places many mandates on its businesses,” Charles Firlotte, president of the Aquarion Water Co., said in testimony submitted to the Labor and Public Employees Committee.
This story originally appeared on CTMirror.com, where the full text can be read.
MILFORD — At the 59th annual meeting of the Milford Chamber of Commerce held January 29 at Grassy Hill Country Club, the business group presented “Awards of Distinction” to 13 local individuals and organizations. Among them: Businessperson of the Year — John Walsh of Total Mortgage Services, LLC; Corporate Award — Michael Zahornacky of Excello Tool Engineering & Mftg. Co.; Lifetime Achievement Award — Jody Culmone of Milford Consortium for Child Care Initiatives Inc.; and Small-Business Person of the Year — Gus & Julia Grigoriadis of Pop’s Family Restaurant. Some 200 people attended the event.
New Haven Magazine