Connecticut 2018 Regular Session

Connecticut House Bill HB05106

Introduced
2/14/18  

Caption

An Act Concerning A Pay Ratio Corporation Income Tax On Publicly Traded Companies.

Impact

If enacted, HB 05106 would fundamentally alter how publicly traded companies are taxed in the state. By implementing a pay ratio-based tax structure, companies with larger wage disparities would face progressively higher tax rates, potentially leading to increased revenue for the state. It may also encourage companies to reconsider their wage structures, promoting better income equality within the workforce. The changes made by this bill would require amendments to existing corporate tax statutes to incorporate this new classification.

Summary

House Bill 05106 proposes a significant overhaul of the current corporation income tax system applicable to publicly traded companies. The bill seeks to replace the existing flat taxation method with a tiered tax rate structure that correlates the tax rate to the pay ratio between the highest-paid employee and the median employee compensation within the company. The intent of the bill is to create a more equitable taxation system that reflects income distribution within corporations, thereby addressing disparities in compensation.

Contention

The bill has generated discussions on the implications of tax policy based on income inequality. Supporters of HB 05106 argue that this approach fosters greater corporate responsibility regarding employee compensation and could help reduce income disparities in society. Critics, however, may contend that such a tax structure could deter investment in publicly traded companies or drive businesses to relocate to jurisdictions with more favorable tax structures. There are concerns that companies might resort to manipulating pay systems to avoid higher tax rates, potentially backfiring on the bill's original objective.

Notable_points

Another notable aspect of HB 05106 is its potential influence on corporate governance and operational strategies. As companies strive to manage their public image and shareholder interests, they may adopt policies aimed at aligning executive pay with median employee wages more closely. This bill symbolizes a growing trend toward accountability and transparency in corporate practices, reflecting societal values around fairness in compensation.

Companion Bills

No companion bills found.

Previously Filed As

CT HB05470

An Act Concerning Transportation Network Companies And Third-party Delivery Companies.

CT SB00076

An Act Reducing The Personal Income Tax Marginal Rates For Certain Taxpayers And Concerning The Asset Expense Deduction For Corporations.

CT HB05232

An Act Concerning Solar Projects Throughout The State.

CT SB00006

An Act Concerning Housing.

CT SB00007

An Act Concerning Connecticut Paid Sick Days.

CT HB05513

An Act Concerning The Deduction And Withholding Of Personal Income Tax From Certain Payments And Distributions.

CT SB00005

An Act Concerning School Resources.

CT SB00501

An Act Concerning Motor Vehicle Assessments For Property Taxation, Innovation Banks, The Interest On Certain Tax Underpayments, The Assessment On Insurers, School Building Projects, The South Central Connecticut Regional Water Authority Charter And Certain State Historic Preservation Officer Procedures.

CT SB00132

An Act Concerning Dog Racing.

CT HB05147

An Act Restructuring Certain Taxes.

Similar Bills

No similar bills found.