Gov. Dannel P Malloy will ask the state's 46,000 employees to give up $2 billion in salary and union concessions -- including worker-suggested savings such as changes to work rules -- over the two-year budget that starts July 1.

The salary and union concessions are part of a larger package to balance a $3.2 billion budget deficit. Malloy announced Monday that he will seek an increase on income, sales and other taxes. He is also expected to announce spending cuts, but has yet to reveal details on what could be slashed.

Malloy said he understands many people will be upset by his plans, but feels that they are necessary.

"You have to do the best under the circumstances that you inherit," Malloy said Tuesday morning. "You know what? Everyone is going to be upset. The alternative is not to be the Connecticut we are."

The billion dollars of concessions in the first year would have to be negotiated with the coalition of unions. If achieved, the deal would combine with $1.5 billion in new taxes and $700 million in spending cuts to balance the $3.2 billion deficit in the first year. Similar savings would be realized in the second year of the biennium.

Malloy spokesman Colleen Flanagan said the exact details of the governor's proposed labor concessions, including salary and benefits changes, will emerge "over the coming days and weeks."

On Tuesday morning Malloy also released dates for a series of 17 Town Hall Meetings that he will hold across the state to discuss budgetary and economic issues. The meetings will take place starting on Feb. 21 in Bridgeport and will end on April 6 in Danbury.

"It really is my preference to be out there, talking with people in the flesh, hearing their thoughts and communicating in a civil manner that will bring out the best and most productive changes benefitting the State of Connecticut," Malloy said in a release. "It's important that we have a chance to talk about some of the changes I'm proposing to help create new jobs and get our state's fiscal house in order, and I want to hear what people think."

The Feb. 21 Bridgeport meeting will be held at the City Hall Annex from 7 p.m. to 8 p.m. In addition, there will be a meeting in Stamford on March 22 at the Government Center, on March 28 in Greenwich in the Town Hall Meeting Room and on April 6 in Danbury at a location to be determined, all from 7 p.m. to 8 p.m.

Malloy announced Monday that he will seek higher taxes on gasoline, hotel rooms, cigarettes, alcohol and rental cars. In addition, scores of now-exempt services and products would be subject to sales taxes, including haircuts, car washes, luxury goods, yoga studios, pet grooming, cosmetic surgery and hazardous waste removal.

During briefings with Democratic leaders and then with reporters later in the day, the governor's top advisers said the plans he'll present to the General Assembly are needed to plug what now is estimated to be a $3.2 billion deficit in the state budget that starts July 1.

All of this would be part of a revenue-producing package that would raise $1.5 billion in the first fiscal year and $1.3 billion in the second year, mostly from the middle class.

Income taxes would rise $878 million, retroactive to January, in the first year and $697 million in the second year. Sales and use taxes would rise $461 million in the first year and $480 million in the second year.

Sen. Eileen M. Daily, D-Westbrook, co-chairwoman of the legislative Finance Committee, said Monday she approves of the proposals and believes they are necessary.

"I think it's exactly the shared sacrifice the governor has been talking about," she said in an interview. "We knew it would be ugly. We know we're in bad shape. You have to go where the money is. Any state in the shape we're in right now, you have to take serious measures."