April 24, 2018 | Reading Time: 3 minutes

Will Connecticut Dems Exploit the Coming ‘Taxpocalypse’?

If they’re smart.

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I don’t think Connecticut Republicans are taking seriously the impact of the national GOP’s tax overhaul on state-level politics. At the same time, I don’t think Connecticut Democrats are exploiting it enough. The more polling we see, the more reason we have to believe that November will bring a world of hurt to candidates with Rs next to their names.

We don’t have recent polling in Connecticut, but we do have the latest from Monmouth University on the tides of change taking shape in a neighboring state where the new cap on state and local tax deductions (SALT) is driving Republicans into the arms of Democrats. According to Monmouth, Democrats have a nearly 20-point advantage. Almost all of that is arising in the state’s GOP-held districts. New Jersey’s Republicans are in revolt, and someone is going to pay a price.

The Garden State isn’t alone. The tax cuts were never popular. According to a new NBC/Wall Street Journal poll, most Americans are indifferent, but a plurality believes they are a bad idea. Working class, middle class and affluent voters dislike the law. The poll found that the Democrats have a seven-point lead in the race to control Congress.

The natural counterpoint is that these numbers are about Washington, not the states. That New Jersey is poised to turn blue doesn’t mean the NJ GOP will be in the woods. Ditto for Connecticut. As JR Romano, head of the Connecticut GOP, is wont to say: the game begins and ends with the historic unpopularity of Gov. Dannel Malloy.

This seemed correct months ago when it was clear that Connecticut voters blamed Malloy for higher income taxes and for public-sector concessions. But that memory is fading and being replaced by a scarier fiscal reality — and there’s long way to go before November.

Connecticut’s fiscal affairs may be a dumpster fire, but as time goes on, it’s clear we ain’t seen nothing yet. A writer for The Atlantic’s City Lab wrote: “The state relies on property taxes, and after the GOP tax bill, many fear that housing values will stagnate or crash.”

Put another way, he said, it’s a “taxpocalypse.”

The national GOP tax cut means millions upon millions will be extracted from Connecticut, New York, New Jersey and other high-tax states. The average SALT deduction in Connecticut, in 2014, was $19,000. About 60 percent of local revenues comes from property tax.

We can kiss that goodbye.

A lot of this will be offset by cuts in tax rates and by doubling the standard deduction. But this won’t offset the loss entirely. As wealth is siphoned off, more pressure will be put on affluent suburban property owners. In many cases, these are rock-rib Republicans who now have as much reason to revolt as do Republicans in New Jersey.

State-level Republicans can promise to fight property tax increases, as they do, and to cut some public services, as they do. They can vow to cut property taxes. But, again, 60 percent of local revenues come from land levies. And they can’t stop property values from falling. As one nonpartisan wonk put it recently: There’s “no way to sugarcoat” it.

“Limiting the ability of Connecticut towns and cities to write off property tax paid annually will only place more pressure on the property tax, making local economies and tax environment more uncompetitive and depressing the value of homeownership.”

When people feel pain, they often look for a culprit, and politicians often win when they identity a credible bogeyman . Usually, Republicans can tar Democrats when it comes to taxes. But this year is upside down. Democrats are winning over Republicans in Fairfield County by saying your greatest fears came true thanks to President Donald Trump.


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John Stoehr is the editor of the Editorial Board. He writes the daily edition. Find him @johnastoehr.

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