NCPA - National Center for Policy Analysis

EXCISE-TAX HELL

April 14, 2005

Connecticut cannot continue increasing the tax burden on its citizens indefinitely, says Paul J. Gessing, director of government affairs for the National Taxpayers Union. However, Gov. M. Jodi Rell (R) has proposed increases in some excise taxes:

  • The governor proposes to tack another 74 cent increase onto the state's cigarette tax, pushing Connecticut's rate to an astounding $2.25 per pack; that rate would be among the highest of any state in the nation.
  • She seeks a 15 percent boost in beer, wine, and liquor taxes and a huge hike in taxes on other tobacco products (including snuff or smokeless tobacco) from 20 percent of the wholesale price to 90 percent; this combined "sin tax" package would cost taxpayers approximately $112 million annually.
  • To top it all off, the new governor has proposed raising the state's gas tax at a time when prices are higher than ever.

Complementing Rell's proposed sky-high cigarette tax with a gas-tax rate among the highest in the country would cement Connecticut's status as an "excise tax hell," says Gessing.

Since abundant economic research has shown that income taxes -- especially steeply progressive ones -- are the single most economically harmful form of taxation, the Democrat plan would only hasten the exodus of productive workers and increase the likelihood of the state losing yet another seat in Congress in 2010, explains Gessing.

Source: Paul J. Gessing, "Excise-Tax Hell: Out-of-control Republicans in Connecticut,"National Review Online, March 29, 2005.

 

Browse more articles on Tax and Spending Issues