With 11 more days to collect, the state has already far exceeded its goal of $35 million in tax amnesty collections.
The state has collected nearly $63 million so far in order to balance the state budget, according to state tax commissioner Kevin B. Sullivan.
The 60-day amnesty program, approved by the legislature earlier this year as part of the annual budget, started on September 16 and is scheduled to end on November 15. If tax delinquents come forward, they can avoid criminal prosecution and pay 3 percent interest instead of the state’s normal rate of 12 percent.
Virtually any business or individual with back taxes is eligible, including those already enmeshed in civil lawsuits against the state, those who are currently being audited, and those who have not paid taxes at all.
The state’s number one tax delinquent is New Haven-based Renaissance Management Company, which is a real estate business that is operated by the family of state Senator Toni Harp of New Haven. The business owes more than $1 million in back taxes and penalties, but Harp told The Courant recently that the company would “absolutely not” use the state’s tax amnesty program to lower its bill.
Sullivan, a longtime West Hartford Democrat who worked for years with Harp in the state Senate, has declined to comment about Harp’s case. The money is owed by the real estate company and not by Harp personally.
Under amnesty, the delinquent taxpayers can avoid 75 percent of the interest that has accumulated on the total, as well as eliminating all penalties. For those owing substantial sums, the tax amnesty can save them large amounts of money.
“The governor and state legislature wisely took a conservative approach, so I am glad we are exceeding expectations,” Sullivan said in a statement. “As I have said before, this is a chance for delinquent taxpayers to do the right thing and the smart thing. It returns more to the state on behalf of all our taxpayers than would likely be realized through the expense of the usual collection efforts. This also means we can focus enforcement even more on those who fail to come forward during the amnesty period, and we will find them.”
Previous tax amnesty programs under earlier governors have generated $54 million in 1990, $46 million in 1995, a surprising high total of $109 million in 2002 under Gov. John G. Rowland, and $25 million in 2009 under Gov. M. Jodi Rell.
Overall, the state is owed an estimated $400 million in back taxes from nearly 80,000 taxpayers. The back taxes must be paid by November 15 to avoid the interest and penalties.