A Message from the CBA President: Proposed Sales Tax on Legal Services

Dear Colleagues:

As you are well aware, Governor Lamont’s budget included a line item of $107 million in revenue for Fiscal Years 2020 and 2021 through the expansion of sales tax on legal services. Business to business will remain exempt from sales tax. I believe we all agree this will be damaging to our clients and our businesses. A hearing on the proposed tax has been scheduled for Friday, March 15, 2019 at the legislature.  This proposal affects us all and we are asking for your assistance in opposing this tax.

We are asking you to contact your State Representative or State Senator to voice your opposition to this proposal.  You can find your legislators HERE.  PLEASE take ten minutes to communicate with your legislators by Wednesday of this week. Since a number of professions are having their exempt status challenged, our goal is to express why legal services are unique from other taxable goods and services.

Here are talking points you can use when you contact your State Representative or State Senator to voice your opposition to this proposal. Please do not just copy and paste. Please choose 2-3 issues and expand. If you are interested in testifying in opposition to the proposal, please contact Bill Chapman at bchapman@ctbar.org so we can coordinate our efforts.

  • 47 states do NOT have a tax on legal services; only New Mexico, South Dakota and Hawaii do—Connecticut should not be the fourth.
  • Two other states, Florida and Massachusetts, passed a sales tax on legal services and within six months that was withdrawn because, as you can imagine, it was both unpopular and an administrative nightmare.
  • It is a “misery” tax. Unlike other goods and services, the purchase of legal services is rarely a choice, but arises out of necessity. Most people seek legal services during times of misery, misfortune, hardship and vulnerability when facing eviction, foreclosure, divorce, domestic violence, end-of-life care, the death of a loved one, bankruptcy, discrimination, criminal charges or injury.
  • It would punish people for taking responsible steps in managing their affairs.
  • A sales tax on legal services will place another barrier to access to justice, and punish those seeking to exercise their right to counsel. Our citizens may choose to forego legal representation and self-represent themselves thereby burdening our courts further.
  • It will violate the attorney-client privilege.
  • It will interfere with a person’s financial ability to defend himself/herself in a criminal case resulting in the Public Defender Offices facing increased demand and increased costs to Connecticut.
  • Any sales tax on legal services would be disproportionately born by our small businesses and our citizens in need.
  • Large multi-state and multi-national businesses doing business in Connecticut will be able to avoid such sales tax by hiring in-house attorneys providing large companies with a competitive advantage in any litigation over our citizens and small businesses.
  • A sales tax on legal services will drive up the cost of legal fees in Connecticut, making Connecticut firms less competitive with firms in other states where a sales tax on legal services does not exist. It would encourage our citizens and businesses to seek legal services from neighboring jurisdictions where the exemption remains and avoid selecting Connecticut as a venue in forum selection clauses resulting in a decline in work for Connecticut lawyers, and, in turn, a loss of jobs for Connecticut lawyers, support staff and support services.
  • It will have a negative effect on the Connecticut legal community creating an administrative burden on law firms, particularly solo and small firm attorneys which represents almost fifty percent (50%) of our attorneys.
  • Attorneys, who already provide extensive pro bono and low bono services to help our citizens access justice, may absorb the costs of the sales tax resulting in lower income tax revenue for Connecticut.
  • The projected tax line item for the governor’s budget is over zealous.

Please identify yourself as a constituent and take a few of these points and share your concerns with your State Representative and State Senator.

Thanks you for your support of our profession.

Jonathan M. Shapiro 2018

 

 

 

Jonathan M. Shapiro
CBA President

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Justice Richard A. Robinson Confirmed to Serve as Next Chief Justice

Justice Richard Robinson - FBGovernor Malloy announced the final legislative confirmation of Richard A. Robinson to serve as chief justice of the Connecticut Supreme Court, following Chief Justice Chase T. Rogers’ retirement from the bench on February 5, 2018. Chief Justice Robinson will be the first African American chief justice of the Connecticut Supreme Court.

The Honorable Steven Ecker of the Bridgeport Superior Court will fill the associate justice seat on the Connecticut Supreme Court. Justice Ecker has been a judge of the superior court since 2014.

Read CBA President Karen DeMeola’s statement
regarding Chief Justice Robinson’s confirmation.

A Message from ABA President: Treatment of Law Firms in Tax Relief Bills

CBA logo CMYK

The message below was sent out on Wednesday, 12/13
from American Bar Association President Hilarie Bass.

“Dear Colleague,

As you may have heard, the tax reform bills passed by the House and Senate contain provisions that exclude many law firms and other professional service businesses from the substantial federal tax reductions that will be granted to most other partnerships and other ‘pass-through entities.’ (The House bill would completely deny a new 25% pass-through tax rate if the law firms’ income fell below a certain threshold.”

The ABA is joining lawyers and law firms around the country in opposing these discriminatory provisions, and we need your help to make sure that they are removed from the final tax legislation.

Please call Congress today at (202)224-3121 and tell your senators and representative that you opposed discriminatory provisions in the tax bills that prevent law firms from receiving the same tax reductions as other pass-through businesses. (Look up your legislators here.) The ABA is not taking a position on the overall tax reform legislation, and we are not asking you to take a position.

Our message is simple: ‘All pass-through businesses should be treated equally, and law firms should not be unfairly excluded from new pass-through tax reductions.’

Talking points and more information about pass-through entities and the proposed tax legislation is available on our website. If you have any questions or would like to share feedback about your calls please email us at: GrassrootsCenter@americanbar.org.

Sincerely,

Hilarie Bass
President, American Bar Association”

 

2-7-17 Capitol Update

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The CBA’s legislative lobbyist, Bill Chapman, guides us through the 2017 legislative session (January 4 – June 7), with latest news, interviews, CBA position updates, and more in the Capitol Update newsletter and video series. These Capitol Updates are also available to members at ctbar.org/capitolupdate.

Read this week’s newsletter!
2-7-17 Capitol Update Newsletter

To view the full version of this week’s Weekly Docket, click here.

1-30-17 Capitol Update

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Join the CBA’s legislative lobbyist, Bill Chapman, in our new Capitol Update video series. Stay current as Bill guides us through the 2017 legislative session with latest news, interviews, CBA position updates, and more!

Check your inbox every Monday for your Capitol Update in the Weekly Docket during this year’s legislative session (January 4 – June 7). These Capitol Updates are also available to members at ctbar.org/capitolupdate.

Watch this week’s video!
Capitol Update Video – An Interview with Elder Law Section Lobbyist Melissa Biggs

Read this week’s newsletter!
1-30-17 Capitol Update Newsletter

To view the full version of this week’s Weekly Docket, click here.

This Week’s Capitol Update

7ee46119-dd73-445e-b959-822bc341d285

Join the CBA’s legislative lobbyist, Bill Chapman, in our new Capitol Update video series. Stay current as Bill guides us through the 2017 legislative session with latest news, interviews, CBA position updates, and more!

Check your inbox every Monday for your Capitol Update in the Weekly Docket during this year’s legislative session (January 4 – June 7). These  Capitol Updates are also available to members at ctbar.org/capitolupdate.

Watch this week’s video!
Capitol  Update Video – An Interview with State Comptroller Kevin Lembo

Read this week’s newsletter!
1-23-17 Capitol Update Newsletter

To view the full version of this week’s Weekly Docket, click here.