Connecticut House Bill HB05099

Connecticut 2016 Regular Session

• Introduced: 2/9/16
• Refer: 2/9/16

Caption

An Act Phasing Out Personal Income Taxation On Pension Income And Social Security Benefits.

Impact

If enacted, HB05099 would lead to significant changes in the state's tax structure, particularly concerning the income of retirees. This would not only lessen the tax burden for senior citizens but could also be seen as a strategy to retain older residents and attract new ones from other states. The long-term implications of this shift could affect state revenues, which may need to be compensated by adjusting other tax structures to ensure that funding for public services remains stable. The overall goal is to create a more favorable financial environment for those in retirement age.

Summary

House Bill 05099 proposes to phase out the personal income taxation on pension income and Social Security benefits in Connecticut. The primary intent of this legislation is to provide tax relief to senior citizens, ensuring that their retirement income is not subject to state taxes. By doing so, the bill aims to improve the financial situation of retirees, making it easier for them to manage their income during retirement. Additionally, it seeks to enhance Connecticut's competitiveness with other states that may offer similar tax benefits to attract retirees and strengthen the local economy.

Contention

Discussions surrounding HB05099 may highlight various points of contention. Proponents argue that the elimination of income taxes on retirement income is a necessary step for financial equity and to combat the rising costs of living for seniors. However, opponents may raise concerns about the potential impact on state revenue and public services funded by these taxes. There could be debates on the fairness of such tax reductions, specifically questioning whether all residents should bear the burden of lost revenue, and whether this bill disproportionately benefits wealthier retirees over those with modest incomes.