It has been brought to the attention of CALS, by our lobbyist The Reynolds Group, that the Connecticut General Assembly Finance Committee, in SB 946, has proposed repealing the exemption from the state’s sales tax on Design Professions, including land surveying services. CALS believes this could have a significant negative impact on surveying and consumers in need of survey services. We, as a group, need to respond to this immediately. CALS is asking YOU to contact you legislators to prevent this legislation from passing.
Among the negative impacts of this action, will be:
1. A significant increase in costs for all design phases of construction projects. After an extended down period, the construction industry has begun a moderate resurgence, and a sales tax could negatively affect this resurgence.
2. A sales tax would also impact the housing market, making housing less affordable for residents in the state. Many homeowners have begun to invest in home improvements again. The bottom line is critical to many consumers and may ultimately determine whether a project is pursued or not. As property improvements increase property values, property taxes will also rise. A sales tax might retard this process.
3. The sales tax instituted in 1989 was complicated and difficult to administer for the State and the design professionals. Any new sales tax will be encumbered with the same problems. Every dollar the State spends administering the tax decreases the revenues raised by the tax. Every dollar we spend determining, billing, collecting and paying the tax, will ultimately be passed on to the consumer.
In 1992, when the previous sales tax was repealed, the Department of Revenue Services itself recommended that the tax be eliminated, in part because of the complexity in administering the tax.
Visit here for a Q&A on the sales tax. http://ctengineers.us3.list-manage.com/track/click?u=5724d0de05ad6f518e32c0fe7&id=77e57c3eda&e=af911d83ff
4. Any downturn in work will affect the labor market. The loss of work will mean fewer jobs for Connecticut surveyors and support staff, and result in lower income taxes paid to the state.
5. Although the tax will affect large and small firms, a sales tax is particularly onerous for small firms. A vast majority of the firms that CALS represents are small firms. Valuable time that could be devoted to production will be lost. Purchasing design services is not like buying groceries or other hard goods. The design product is not scanned at check out and paid for at the door.
6. Most design projects involve extensive permitting and regulatory review. Design professionals and attorneys participate in this process. Why should design professionals be taxed for their services in this process, while the attorneys are not?
Kevin Reynolds, CALS lobbyist, will be the guest speaker at the General Membership Meeting on May 7th. This will be a great opportunity for you to get an update and ask questions about this important issue.
Contact your legislators. Get your legislators contact information: Visit here. http://ctengineers.us3.list-manage.com/track/click?u=5724d0de05ad6f518e32c0fe7&id=570ac51265&e=af911d83ff
Leadership contact information and Finance Chairs/Ranking Members:
- Len Fasano – Senate Minority Leader, mail to: firstname.lastname@example.org, (860) 240-8467
- Themis Klarides – House Republican Leader, mail to: email@example.com, (860) 240-8700
- Bob Duff- Senate Majority Leader, mail to: firstname.lastname@example.org, (860) 240-0414
- Brendan Sharkey – Speaker of the House, mail to: email@example.com, (860) 240-8661
- Martin Looney – Senate President, mail to: firstname.lastname@example.org, ((860) 240-8614
- Joe Aresimowicz – House Majority Leader, mail to: email@example.com, (860) 240-8489
- Jeff Berger – Finance Co-Chair, mail to: firstname.lastname@example.org, (860) 240-8500
- John Fonfara – Finance Co-Chair, mail to: John.email@example.com, (860) 240-0462
- Chris Davis – Finance Ranking Member, mail to: firstname.lastname@example.org, (860) 842-1423
- Scott Frantz – Finance Ranking Member, mail to: email@example.com, (860)240-8865
Thank you for your prompt attention to this matter.
Please visit the legislative page on the CALS website for frequent updates.
Very truly yours,
Jeffrey J. McDougal, President