(WTIC-AM) -- Democrats on the General Assembly Finance Committee have proposed a new 2 percent tax on investment income earned by high-income people.
Committee Co-chair Representative Jason Rojas says a state capital gains tax could take the place of some other revenue proposals on the table. He says capital gains revenue could replace proposed income tax expansions on veterinary services and textbooks. It might also take the place of a proposed tax on sugar-laden beverages.
"It remains to be seen whether it is a good way to raise revenue," Rojas said. "I do recognize that it is a volatile revenue stream. That is something that Connecticut has been challenged by.
"I think it is something we should consider and look at," Rojas said.
Rojas said the 2-percent tax could generate about $262-million in revenue for the state.
The tax would apply to people in the highest tax bracket.
Currently, investment income is taxed at the normal income tax rate in Connecticut. This proposal would add 2 percent to that.
Some high-income earners may be able to afford the surcharge, because they got a tax break from recent federal income tax changes, Rojas said.
Senate Republicans did not immediately return a request for comment.