State Representatives Tim O’Brien (D-New Britain) and Robert Sanchez (D-New Britain) voted in committee last week in support of a plan to establish a state Earned Income Tax Credit. Governor Dannel Malloy and Connecticut General Assembly Democrats have agreed to create the state EITC set at 30% of the federal EITC. Both Rep. O’Brien and Rep. Sanchez voted in favor of that compromise measure during today’s Finance Committee meeting.
The federal EITC was created in 1975 and provides a refund to the working families and individuals of modest means. It is a refund on personal income taxes which reimburses people for sales, property, gas and other taxes that they pay.
“This will mean more than $4 million in tax relief for New Britain residents, much needed relief for working people who need this money to provide for their families,” said Rep. O’Brien. “This is $4 million that will be brought into our community, spent at our city’s stores and creating jobs for people in our community. This is a very good thing for New Britain.”
Thousands of Connecticut families benefit from the federal EITC. In 2007, the federal EITC helped 183,623 families in Connecticut, an average return of $1,776. In New Britain, over 40,000 families benefited with an average return of over $1,900.
“This will mean close to $2 million for my district, meaning added revenue for my community, with the majority being spent there as well,” said Rep. Sanchez. “Tax relief is what we need in New Britain and $4 million is better than no tax relief at all.”
Connecticut Democrats have been eager to establish a state EITC, but have been blocked for years by a promise of a veto by the former Governor.