While Governor Ned Lamont appears to be working to scale back the number of prepared food items that will become subject to sales tax October 1, Newtown’s statehouse delegation members have responded to The Newtown Bee with reactions in recent days.

On September 13, Rep Mitch Bolinsky (R-106) attended a press conference with House and Senate Republican lawmakers to discuss newly released details on the 7.35 percent “meals tax” set to go into effect. The tax was included in the state budget passed by legislative Democrats and signed into law by Governor Ned Lamont during the 2019 legislative session.

According to a Department of Revenue Services (DRS) policy statement issued this week, the Democrat-approved and Lamont-encouraged tax will be applied to a long list of food items that have never been taxed before.

At presstime, the taxes were expected to apply to not only prepared meals such as sandwiches, deli salads, pizza, and hot buffet items, but also small packages of snacks, loose baked goods, wrapped salads, small salad mixes in the grocery store, store-cut servings of fresh fruit, small servings of ice cream and “meal replacement bars.”

It also applies to fountain drinks, including coffee and any beverage sold with a newly taxable “meal.”

“This grocery tax is just another example of how the budget... this year hurts middle- and working-class families, seniors, and individuals in Newtown,” said Rep Bolinsky.

“On Governor Lamont’s authority, DRS widened the net to create a new, full-blown food tax. The new definition of a ‘meal’ will put nearly everything we consume at risk of being taxed,” he said. “This kind of deception is unacceptable and is not the ‘honest budgeting’ the governor promised on the campaign trail.”

In June, Governor Lamont and legislative Democrats labeled the new tax as only a one percent tax increase on items already taxed at 6.35 percent. But, the DRS statement clarifies that the new 7.35 percent tax will now apply to many food items that have never been taxed at grocery stores.

“I opposed their initial proposal because it was overly vague and left too much room for interpretation to folks who cannot be trusted to spend our tax dollars responsibly,” added Rep Bolinsky. “This tax is regressive and will make it even more difficult for our community’s most vulnerable populations to pay for some of their most basic food necessities. Enough is enough.”

Rep Raghib Allie-Brennan, who’s Second District represents several neighborhoods in western Newtown pointed out that the budget adopted this year lowers taxes on many things — including eliminating taxes on Social Security for the vast majority of families and cutting taxes for small businesses.

“It does not raise the income tax or the sales tax rate,” Rep Allie-Brennan said. “The budget does include a tax on prepared foods. In the past, prepared, ready-to-eat meals sold in restaurants were taxed — but the exact same prepared ready-to-eat meals for sale at the deli counter in grocery stores were not.”

Rep Allie-Brennan said the provisions of the budget that support working families and bring resources back to Newtown are important and necessary.

“No budget is a perfect document, but we have a responsibility to keep government running,” he said. “That involves continued compromise. With that said, The Department of Revenue Services issued new policy guidance, reinterpreting the definition of ‘meal’ to include more food items. In this case, the department provided broader interpretation than was intended.”

Rep Allie-Brennan said Connecticut residents “should not have to bear new expenses because of bureaucratic overreach.”

“This week, my colleagues and I urged the Lamont Administration to reverse the DRS guidance expanding the prepared meals tax,” the freshman lawmaker added. If DRS doesn’t fix this — we will.”

‘Dishonest And Indefensible’

On September 12, State Representative JP Sredzinski (R-112), who represents hundreds of southern Newtown households, blamed Democrats for crafting a solution to the state’s financial woes by imposing regressive taxes

“Nearly everything we consume is fair game in this ‘meals tax’ scheme, and that hurts families, seniors, and some of our community’s most vulnerable populations,” said Rep Sredzinski. “Governor Lamont and the Democrats in the legislature have misled the public by finding a back-door way to tax our most basic food necessities. That is simply dishonest and indefensible.”

Late Wednesday afternoon, September 18, State Senator Tony Hwang contacted The Newtown Bee fuming over the fact that Republican members of the General Assembly had been initially rebuffed after petitioning for a special session to go in and make changes to the legislation that initiated the tax.

“It was our hope to go in and try to fix this mistake, but in reality we learned that we can’t do anything that would affect any changes by October 1,” Sen Hwang said. “We actually have to go in and change the law. This is not how policy making should work.”

Instead, Sen Hwang feared that any changes that might occur would do so between legislative leadership and DRS officials outside the public eye.

“We need to do the business of government and fix this mistake that was made the right way, not in a closed room discussion,” Sen Hwang said. “To suggest they are going to just go in and fix it outside of a special session is simply arrogant.”

In a previous statement, Sen Hwang aligned with his Newtown delegation colleagues, saying the so-called “meals tax” is another way state leadership is hurting “working and middle class families, taking more and more out of people’s wallets every day for basic food and living needs.”

On September 17, The Connecticut Mirror reported that Gov Lamont expects the new sales tax surcharge on prepared foods will be scaled back. The Democratic governor, who made the announcement following the State Bond Commission meeting, echoed concerns raised over the past week by legislators from both parties.

But the governor’s budget director, Office of Policy and Management Secretary Melissa McCaw, said legislators also could have helped back in June when they enacted the tax hike by drafting more specific language.

“I think that DRS too broadly interpreted what was the intent of the legislature,” Gov Lamont said, referring to a Department of Revenue Services policy statement crafted in late August to help retailers prepare for the tax hike.

Scaling Back?

The governor said his budget office already has begun working with revenue services officials to scale back the range of items that would be subject to the surcharge. “We know what was intended,” he said.

Gov Lamont said DRS did not run its list of taxable food items by his office before publishing it.

Initially, both Gov Lamont and Democratic leaders in the House and Senate responded simply by saying Republicans were hardly in a position to criticize. Democrats had made many difficult choices, they said, while successfully closing a projected $3 billion-plus deficit in the new state budget without increasing income tax rates.

Republicans, on the other hand, opted not to show their cards last spring, offering no plan to close the shortfall — after a decade of offering alternative budgets. But things intensified last Friday when the legislature’s nonpartisan Office of Fiscal Analysis revised its estimate on how much revenue the surcharge would generate.

Based upon the policy statement, OFA projected the tax would generate $158 million over this fiscal year and next — nearly 40 percent more than lawmakers anticipated. By 2020-21, consumers would pay more than $90 million per year.

Majority Democrats in the Senate announced mid-day Monday, September 16, that they thought DRS had gone too far. The House Democratic Caucus followed suit late that afternoon.

“The unilateral decision by the agency to expand the sales tax to additional food items is not consistent with the intent of the budget,” House Democrats wrote in their statement.

Gov Lamont did not say Tuesday which items would be identified as taxable and which as non-taxable. But he noted that, under current law, prepared foods — unlike groceries — are subject to the regular 6.35 percent sales tax, even if sold at a supermarket.

And the goal of the legislation was to apply a surcharge to all of these items already subject to the sales tax.

The governor added that he expects a revised policy statement to be made available to retailers “as soon as possible.” And OPM Scty Ms McCaw said she doesn’t believe it will take her office and tax officials long to develop one.

Connecticut Mirror reporting by Keith M. Phaneuf was included in this report.