The Gov. Ned Lamont today is proposing an increase in Connecticut’s income tax rate.
The governor said on Monday that his budget plan will include an increase in the state income tax rate from 30.5% to 40%.
The governor said that he will provide $44.6 million in additional state tax credits to approximately 211,675 low-income families above the amount they currently receive.
“Many studies have shown that the EITC is one of the best anti-poverty tools we can use because it encourages work, improves economic stability, and lifts up future generations. Finally, this tax credit helps improve all communities because these dollars are invested directly into our local economy through food, transportation, clothing, rent, utilities, and other eligible expenses. The EITC encourages work and promotes economic stability, and I think it’s time we increase it,” Lamont said in a statement.
According to the governor, the Connecticut EITC is a state tax credit for low-income workers and families that mirrors the federal EITC.
The federal eligibility requirements for 2022 are:
- No dependents: $16,480 for individuals and $22,610 for joint filers
- Single dependent: $43,492 for individuals and $49,622 for joint filings
- Two dependents: $49,399 for individuals and $55,529 for married filing jointly
- Three dependents: $53,057 for individuals and $59,187 for joint filers.
The Governor’s Office said that the total amount of debt of each family needs to be analyzed and it depends on the amount of their debt. federal.
He said under the current rate of 30.5%, a married family with two eligible children would receive a state tax credit of up to $1,880. If the rate is 40%, that same household will receive a state tax credit of up to $2,465.
The Connecticut EITC was created in 2011. Here are the rates for the last ten years, including:
- 2011: 30%
- 2012: 30%
- 2013: 25%
- 2014: 27.5%
- 2015: 27.5%
- 2016: 27.5%
- 2017: 23%
- 2018: 23%
- 2019: 23%
- 2020: 23%
- 2021: 30.5%
- 2022: 30.5%
On Wednesday, February 8 at noon the governor will give his annual financial speech before the General Assembly.