HARTFORD, Conn. -- The Connecticut General Assembly passed a transportation bill that includes provisions for raising the state's tax on gross earnings derived from the sale of petroleum products. The first increase will take effect today and will cost consumers roughly an extra penny per gallon, said Gene Guilford, director of the Independent Connecticut Petroleum Association (ICPA).
"Governor Rell's transportation package, which was passed by the Connecticut legislature, is a broad measure with many laudable provisions, said Guilford. However, the [image-nocss] gasoline dealers of Connecticut are seriously opposed to funding the bill by raising the tax on gross earnings from the sale of gasoline and other petroleum products."
He added, "This measure will result in raising the price of gasoline for Connecticut consumers at a time when gasoline price are already at near record highs due to world energy demand and energy price speculation on the NYMEX."
At present, Connecticut consumers pay a 25-cents-per-gallon state excise tax on gasoline, and another 18.4-cents-per-gallon federal excise tax on gasoline. On diesel fuel, Connecticut consumers pay a 26-cents-per-gallon state excise tax and another 24.4-cents-per-gallon federal excise tax. These prices are already the third-highest excise taxes in the region, he said.
In addition, Connecticut motor fuel prices reflect the effect of the "hidden" state tax on gross earnings derived from the sale of petroleum products, currently at 5%. The new legislation raises the rate on that tax to 5.8% effective July 1 - tomorrow - and continues to increase the tax rate to as high as 8.1% by July 1 of 2013.
The average fillup for the family car is 20 gallons, said Guilford. Based on an average retail price of $2.31 per gallon, this cost today is $46.20. Of this $46.20, $8.68 is state and federal excise tax, and the Connecticut Gross Earnings Tax adds another $2 [10 cents per gallon x 20 gallons], for a total of $10.68 in just taxes per 20-gallon fillup.
The average fillup for a trucker using diesel fuel is 150 gallons, according to Guilford. Based on an average retail price of $2.55 per gallon, this cost today is $382.50. Of this, $75.60 is state and federal excise taxes, and the Connecticut Gross Earnings Tax adds another $15, for a total of $90.60 in just taxes per 150-gallon fillup.
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