WeVote
Log In

Bill

Bill

SB 742

AN ACT ESTABLISHING A CAPITAL GAINS SURCHARGE.

2025 Regular Session Introduced by Jorge Cabrera and 2 co-sponsors

Connecticut proposes adding a surcharge tax on capital gains investment income to increase state revenue, potentially affecting investment decisions and wealth distribution.

PUBLIC HEARING 0226
#capitalgainsanddividendstax
0
WeVote Research Nonpartisan
Bill Summary · SB 742

Legislative bill overview

SB 742 proposes establishing a surcharge on capital gains in Connecticut, adding an additional tax layer on investment income above a certain threshold. The bill is currently in the Finance, Revenue and Bonding Committee following a public hearing in late February 2025.

Why is this important

Capital gains taxes directly affect investment income and wealth accumulation, influencing both individual financial planning and state revenue. Connecticut's consideration of this surcharge reflects ongoing state budget pressures and represents a policy shift that could impact investment behavior and wealth distribution within the state.

Potential points of contention

  • Economic impact and competitiveness: Critics argue surcharges on capital gains may discourage investment and cause high-earners to relocate to lower-tax states, while supporters contend progressive taxation reduces inequality
  • Revenue projections vs. behavioral response: Actual revenue depends on whether investors shift capital gains timing or move investments elsewhere, creating uncertainty about fiscal benefit
  • Scope and threshold details: The specific capital gains threshold, surcharge rate, and exemptions (retirement accounts, primary residences, etc.) will determine who bears the burden and how broadly the tax applies

Compiled from official sources — confirm details with the bill’s official record.

Sign in to ask a question.