Debate Over CT’s Hidden Gas Tax Begins
A freshman senator from Meriden says he’s going to introduce legislation to cap the state’s gross receipts tax on gasoline.
For those unfamiliar with gas taxes, the gross receipts tax is often referred to as the “hidden” gas tax. Currently, the tax is 7 percent of the wholesale price of gas, and Sen. Len Suzio, R-Meriden, is proposing capping it once the wholesale price hits $3.
Connecticut also has a flat 25-cent-per-gallon state gas tax. The gross receipts tax adds about another 20 to 25 cents per gallon depending on the wholesale price of gas.
“When the wholesale price goes up, so does the hidden tax,” Suzio said. “Incredibly, there is no limit to how high the hidden gas tax may go. Connecticut already has the highest gas tax in the nation. I am proposing we put a cap on this hidden tax and give overburdened taxpayers a little relief at the pumps.”
Depending on the price of gasoline drivers in Connecticut pay roughly about 46 cents per gallon in gas taxes: 25 cents from the flat tax and 21 cents on the gross receipts tax. If you add the federal gas tax which is about 18 cents per gallon then Connecticut drivers are paying roughly about 64 cents in tax per gallon making it one of the highest gasoline taxes in the nation.
Asked about what he thought about the proposal to cap the gross receipts tax, Gov. Dannel P. Malloy said “let me remind everybody that New York, Massachusetts, New Jersey, Delaware, Maryland, all have tolls.”
“This is how we pay for transportation in the state of Connecticut and unlike other governor’s what I did in the last session and what I did in this budget was guarantee, every fuel tax dollar actually goes into transportation,” Malloy said.
Previous administrations and legislature’s funneled the money from the gas tax into the general budget where it would be used to pay for everything from operating costs to other state services.
Malloy said because of this shuffling of the money away from its intended purpose Connecticut did a really bad job of investing in its transportation infrastructure over the last 20 years. He vowed to break those bad habits.
“I didn’t create this problem,” Malloy said. “I got hired to straighten it out and that includes transportation.”
If there’s something the state can’t afford to give up right now it’s revenue, but Suzio isn‘t backing down from the fight. He started a petition drive to convince Malloy and other legislators to consider capping the state’s hidden gas tax.