As part of its merger with Raytheon, United Technologies expects to move its headquarters to the Boston area and out of Connecticut, the state it has called home for nearly a century.
Why it matters: A new research paper from the right-leaning Yankee Institute says it's just the latest piece of evidence that the mix of higher taxes and "economic development incentives" don't work.
What they're saying:
- The incentives, "spend more of the state's income every year than is raised by the administration's 2015 corporate tax increases — the increases that drove away General Electric and other major Connecticut corporations," Suzanne Bates, a Yankee Institute senior fellow, and Mark Gius, professor of economics at Quinnipiac University, write.
- "The results, meanwhile, appear ineffectual: even the corporation that received the most of such incentives has recently announced plans to leave the state."
What happened: Bates and Gius' study finds that the combination of higher taxes and development grants ended up costing Connecticut taxpayers $35 million.
- The tax increases were estimated to generate $481 million in receipts from corporations for the 2-year period, but produced just $323 million — about one-third less than projected.
- On the other side, the state's developments grants awarded nearly $358 million in grants or loans to businesses to either move to Connecticut or to remain in the state.
Go deeper: United Technologies, Raytheon reach aerospace mega-merger
.jpg?w=600)
