Connecticut House Bill HB05599

Connecticut 2019 Regular Session

• Introduced: 1/18/19
• Refer: 1/18/19

Caption

An Act Allowing An Affected Business Entity To Choose Its Governing Tax Laws.

Impact

The proposed legislation could significantly impact state tax revenues and the financial strategies of various businesses within Connecticut. By offering businesses the option to opt-out of the affected business entity tax, the bill could alter how these entities manage their tax obligations and overall fiscal responsibilities. Supporters of the bill argue that this increased flexibility can stimulate business growth and attract more companies to Connecticut by providing a more favorable tax environment. However, there are concerns regarding the possible decrease in state revenue and whether the opt-out provision might lead to inequities among businesses.

Summary

House Bill 5599 seeks to amend Title 12 of the Connecticut General Statutes by allowing affected business entities the option to opt-out of the affected business entity tax. This bill introduces flexibility for business entities to select which tax laws they are governed by, specifically allowing them to revert to the taxation provisions that existed prior to the enactment of Public Act 18-49. The move is intended to provide businesses with more control over their tax liabilities and potentially alleviate financial burdens for those that find the current tax framework challenging.

Contention

Debate surrounding HB 5599 reflects broader discussions about tax fairness and business regulation in Connecticut. Proponents of the bill assert that it is a necessary adjustment to foster a more business-friendly atmosphere and encourage economic development. In contrast, opponents may argue that the bill could undermine state efforts to maintain equitable tax systems by allowing some businesses to evade the financial obligations imposed on others. The potential for a detrimental impact on the state's budget could create friction between legislators, with some advocating for the necessity of state funding versus the need to support businesses.