HARTFORD – Greenwich cable television entrepreneur Ned Lamont called Friday for the elimination of the business entity tax – a $250 annual fee that is paid by thousands of small businesses each year.
Lamont made his announcement at City Fare Catering on Franklin Avenue in Hartford, which has been hit hard by a sharp drop in catering business.
A small business owner himself, Lamont said eliminating the tax could help thousands of companies in the state and kick-start the sluggish economy that is still weak after the huge downturn in 2008 and 2009.
“If we could give people an incentive to hire just one or two more people, we would be able to get this economy growing again,” Lamont said. “Right here at City Fare, they used to have 32 folks. Now, they’re down to four. Elimination of the business entity tax is one way that we can tell people: start growing, start hiring people. It’s a nuisance tax. … This would send a message. Let’s eliminate that tax and get growing again.”
Republican Gov. M. Jodi Rell and the Senate Democrats have called for eliminating the tax, but nothing has happened yet at the state Capitol.
To pay for it, Lamont favors the highly controversial “combined reporting” tax that has been strongly opposed by the Connecticut Business & Industry Association because officials say it would translate into a tax increase for corporations. The unitary method would affect companies that have headquarters in Connecticut and operations in multiple states, such as Hartford-based United Technologies Corp. and Fairfield-based General Electric. Currently, 23 states, including New York and Massachusetts, have combined reporting, and it is “a red herring” that other states would recruit business way from Connecticut, he said.
“The trend across the country is to have standardized reporting like this. We’ve been a little behind the curve,” Lamont said. “Other states have been eating our lunch on this issue. Over time, everybody is going to have combined reporting, so we standardize how you allocate your income.”
Large companies like UTC and GE “already operate in states that have the combined reporting standard,” Lamont said. “It really would not impact them at all. It’s transparent, so that Connecticut gets its fair share.”
While Lamont was talking about taxes Friday, former Stamford Mayor Dannel Malloy picked up endorsements from leaders of the lesbian, gay, bisexual, and transgender community. He supports gay marriage, which became legal in Connecticut after a ruling by the State Supreme Court.
Lamont has been leading Malloy in the past three Quinnipiac University polls. Lamont moved into the front-runner status for the Democratic nomination after Secretary of the State Susan Bysiewicz dropped out of the race. They are battling for the nomination with Simsbury First Selectman Mary Glassman, Ridgefield First Selectman Rudy Marconi, and former state Rep. Juan Figueroa of Meriden.