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Article: Now that Connecticut has an income tax, what happens to the state bonds?
- Article from:
- The Bond Buyer
- Article date:
- August 26, 1991
- Author:
CopyrightCOPYRIGHT 1991 SourceMedia, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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The revolutionary income-tax budget that Connecticut adopted last week left municipal analysts and other market players in a quandary over the consequences for the state's bonds.
On the one hand, the state no longer has the stigma of operating without a budget for the current fiscal year, or of relying on a sales tax-based revenue system that bloated budget deficits when the economy went bad. That change has positive implications for the bonds' credit quality, analysts say.
But on the other hand, the budget signed by Gov. Lowell P. Weicker Jr. on Thursday could hurt Connecticut paper. Investors had flocked to Connecticut bonds to escape a tax on ...