Earlier this month, Connecticut’s Commission on Fiscal Stability and Economic Growth, created by the state’s General Assembly as part of the budget process in October 2017, released its final report. The commission, composed primarily of business leaders, recommended balancing the budget through spending cuts rather than revenue increases. It also called for a revenue-neutral tax overhaul that would reduce or eliminate progressive income, estate, and gift taxes, while increasing regressive sales and payroll taxes.

In a new policy memo, EPI economists Josh Bivens and Monique Morrissey, and Connecticut College professor Mark Stelzner write that the commission’s recommendations would increase income inequality while slowing economic growth in the state. Connecticut faces the task of closing a budget deficit during a weak recovery hamstrung by spending cuts. Rather than reverse these cuts, the fiscal commission would double down on them and compound the damage with a regressive tax overhaul. The state, they argue, is already spending too little on public services and investments as it tries to repay debts incurred decades ago—following the recommendations of the commission would only exacerbate this problems.

“Though the commission claims to want to spur growth, its recommendations would do the opposite—magnify the damage to the economy by closing the deficit on the spending side while further shifting the tax burden to low- and moderate-income families whose spending fuels the state’s economy,” said Bivens. “Lower-income residents already pay a much higher share of their income in state and local taxes. The recommendations of the fiscal commission would make an unfair system even worse.”