Indiana Jabs Connecticut with Ad [NBC]

June 11, 2015

NBC Connecticut

Indiana’s Economic Development Corporation purchased a full page ad in East Coast editions of the Wall Street Journal that takes direct aim at recent tax hikes approved by the Connecticut General Assembly.

The ad reads, “GE, Aetna, and Travelers: We offer our support in the wake of Connecticut’s looming tax increase, because friends don’t let friends pay higher taxes.”

Beneath the statement is the trademark statement of the IEDC, “A state that works.”

Joe Brennan, the President of the Connecticut Business and Industry Association, the group that represents companies in Connecticut, said of the ad, “In my mind it underscores the gravity of the situation.”

The Connecticut General Assembly narrowly passed a two year, $40 billion budget last week that included a new unitary reporting tax for corporations and increased data processing fees slated to go up in one percent increments over the next two fiscal years.

In advance of the budget’s passage, GE, Aetna, and Travelers released statements urging the legislature to rethink its position. Aetna and GE went so far as threat to leave Connecticut, while Travelers didn’t go that far.

Top Democrats unveiled the new version of the budget more than a month ago but the concerns of business leaders either weren’t articulated or they fell on deaf ears during that time.

Governor Dannel Malloy’s administration defended the budget deal struck with top Democrats in the General Assembly and a spokesman also criticized Indiana’s ad and recent history. Devon Puglia, the governor’s Director of Media Relations wrote, “Let’s be very clear. Connecticut has one of the lowest – one of the lowest – effective corporate tax rates in America, hovering around North Carolina. While we’ve grown more than 75,000 jobs over the past several years, Indiana’s focus is on passing laws that discriminate against sexual orientation. While we have one of the most attractive corporate tax structures in America, Indiana passes some of the most discriminatory laws in the nation. That’s ultimately the contrast we’re talking about here.”

Malloy, it’s worth pointing out, banned all state travel to Indiana in March amidt concerns over a “religious freedom” law that many interpreted to allow for discrimination against gays.

On the issue of courting business to Connecticut, Brennan with CBIA said he’s not sure that rolling back the tax proposals would move the needle with companies already looking to move elsewhere.

“It’s not about taxes at this point” Brennan said. “This is really the tipping point. It’s years of frustration doing business here. I think people realize that our business climate is viewed nationally as one of the poorest in the country.”

Republicans in the Connecticut Senate who were shut out during budget negotiations that led to the tax deal said they fear a potential “mass exodus” could happen in Connecticut.

Sen. Kevin Witkos, (R – Canton) said, “We’ve got a bullseye on our back if you will so every state is going to come in and start poaching off Connecticut businesses.”