Commentary—

Enjoying Low Taxes Will Cost You

By William A. Collins

Life is full,

Of simple facts;

You pony up,

To cut your tax.

Every Nutmegger past puberty realizes that taxes are cheaper in the suburbs. That’s one reason, along with schools and lawns, why you squirrel up your pennies until you can afford to move out there. It’s just another case of having to spend money to save money.

And those savings can be profound. Connecticut’s poorest cities suffer some of the highest tax rates in the country. Indeed a recent Washington, D.C., study cited Bridgeport as bearing the heaviest burden in the whole nation. And as a rule of thumb here, the property tax rate in our worst-off city usually runs four times that in our spiffiest suburb.

The reasons for this monstrous gap are hardly a mystery. Except for the towns within New York’s orbit — Stamford, Norwalk, and Danbury — our central cities are largely unappealing for development. Their taxes are too high and their social status too low. Thus few new buildings join their revenue bases and their mill rates remain astronomical. Existing property owners and tenants, which is to say those who can’t afford to move out, are thus left holding the bag for the inflated social cost of folks with depressed incomes and dismal educations.

Luckily the suburbs, which have come to control state government through their greater population and wealth, are not totally without conscience (thanks mostly to orders from the Supreme Court). Their agents in Hartford gradually have provided more and more direct financial support for impoverished big-city schools. This keeps them from becoming totally Third World.

But in terms of economic equity, that’s about it. Cities, you see, also bear the brunt of most nontaxable properties — colleges, hospitals, government buildings, highways, and all manner of nonprofit institutions. The state takes a stab at compensating them for this service, but at nowhere near full value. Yale, especially, enjoys an annoying extra exemption, but since suburban lawmakers seem much more eager to placate the university than the city, it continues to stand.

Then there is the whole philosophy of who should pay for schools in the first place, every state’s biggest expense. Hawaii covers the whole tab, letting its municipalities totally off the hook. In Connecticut, coming from more Puritan roots, we believe in letting each town stew in its own juice. The other 48 states range somewhere in between. Suburbanites naturally prefer our system. That’s one reason they move here.

There are also alternative revenue sources to consider. The one on most lips in Hartford these days is to add another 0.5 percent of income tax onto the rate for families earning over $1 million a year. You’d think that might sail right through, given the small number of voting millionaires. But these folks prudently donate plenty of bucks at campaign time. Thus the governor vetoed the last attempt to tax them, and Republican legislators reserve their harshest contempt for those who promote such an idea.

Similar forces control Washington. You may have noticed, for example, that, unlike your phone or cable bill, your Internet service isn’t taxed. Big donors have seen to that, so much the worse for state and local revenues.

Likewise with catalog and Internet purchases. Usually, no sales tax is charged, costing localities billions. It would be no big trick to set up a system through which your zip code would trigger the addition of the appropriate tax to your invoice, and then the taxes would be wired off periodically to the local treasury. Storeowners, governments, and local shoppers would love such a leveling of the retail playing field.

But none of these reforms at any level are actually in the cards. Money rules, and its followers are not likely to allow more taxes on people of means. Instead we’ll probably wind up increasing the levies on tobacco, liquor, and fuel. You know who pays those babies.

(Columnist William A. Collins is a former state representative and a former mayor of Norwalk.)