Jorge Cabrera

Sen. Cabrera Gives Final Approval to Bipartisan, Democratic-Led State Budget with Historic Tax Cuts

More Aid for Local Schools and Nonprofits Rounds Out Bipartisan Two-Year State Spending and Revenue Plan

HARTFORD – State Senator Jorge Cabrera (D-Hamden) today joined in the bipartisan Senate passage of a two-year state budget that includes a historic middle-class personal income tax cut while simultaneously providing towns more money for local schools as well as funding much-needed state social service programs.

The $51.1 billion biennial state budget for July 2023-June 2025 passed the Senate on a bipartisan vote of 35-1. The new state budget includes a total of $612 million in personal income and pension tax cuts while providing $300 million more in state aid to local school districts and hundreds of millions more for nonprofits to pay their employees higher wages.

“Today we continued to provide relief to our state’s middle class and while also increasing aid to towns, cities and our schools and I am pleased to give this two-year budget my approval,” said Sen. Cabrera. “When I went door knocking last year, I heard my constituents loud and clear that more was needed to help them navigate inflation and other high costs. I strongly believe this budget, which includes historic tax cuts, offers a noticeable measure of relief for Connecticut’s middle class.”

The budget passed today includes the first personal income tax cut in Connecticut in nearly 30 years, and it’s focused on Connecticut’s broad middle class – those earning up to $80,000 a year – although all taxpayers will benefit to some extent.

The current 3% income tax rate on the first $10,000 earned by single filers and the $20,000 earned by couples will drop to 2%, and the 5% income tax rate imposed on the next $40,000 earned by singles and $80,000 earned by couples will drop to 4.5%. The income tax cuts are expected to save middle-class households $300 to $500 per year.

The new budget expands the income tax exemption for some pension and annuity earnings, expanding it to single filers making $75,000 – $100,000 and couples making $100,000 -$150,000. And the budget also expands the income tax credit for Connecticut’s working poor from 30.5% of the federal Earned Income Tax Credit to 40%, helping approximately 200,000 Connecticut households.

On the spending side, local school districts are the winners, with many towns getting more state aid and no city or town being cut. The new budget provides $300 million more in Education Cost Sharing (ECS) grants for Connecticut cities and towns, thereby helping to keep local property tax rates low. There’s also $16 million to continue expanded free school meals for children.

Private provider organizations that contract for state-sponsored social services (like aging, disability, corrections, housing, mental health and addiction, early childhood, etc.) will receive $87 million more in each year of the budget, providing 4% and 5.4% cost of living wage increases for their employees.

Other budget highlights include: Restores 100% of service on the New Haven train line and branch lines next year; $3 million to expand HUSKY health care for children up to age 15; $6 million to expand GPS monitoring of domestic violence offenders across the state; $5.4 million to implement early voting initiatives