Republicans call for temporary elimination of state gas tax
With gas prices at record highs, state Republicans are proposing the temporary elimination of the gross receipts tax on gas, which is currently about 26 cents per gallon.
State Republicans also urged Connecticut's congressional delegation to push for the suspension of the federal tax, which is at 18.4 cents. If both policies are enacted, Connecticut consumers would save almost 45 cents a gallon.
The national average gas price is about $4.32 per gallon, while Connecticut's is approximately $4.48.
According to the General Assembly's Office of Fiscal Analysis, which was asked to estimate the revenue loss from suspending the state's gas tax from March 15 to June 30 of this year, the move would amount to $95 million to $180 million in savings for consumers.
"This is quite frankly a no-brainer and will provide immediate relief to families," state Senate Minority Leader Kevin Kelly, R-Stratford, said during a news conference Thursday. "We can go into session as soon as next Wednesday to pass this tax cut and pass the legislation to make sure this tax cut is passed on to consumers."
Senate President Pro Tempore Martin Looney, D-New Haven, and Senate Majority Leader Bob Duff, D-Norwalk, said in a statement responding to the Republican news conference that, "Democrats are in ongoing conversations regarding tax relief for Connecticut residents, including reducing the gas tax."
"Democrats have and will continue to push for policies that reduce the tax burden for middle and working class families while ensuring that the most wealthy and corporations pay their fair share," Looney and Duff continued. "Drivers across the country are suffering from the impact of (Russia's President Vladimir) Putin's Price Hike as a result of his devastating and criminal war in Ukraine. Thankfully, President (Joe) Biden is working to address oil supply around the world in the short term which will have the largest impact on the price of this global commodity."
Democratic U.S. Sen. Richard Blumenthal publicly called for the temporary elimination of the federal gas tax this week.
"The Gas Prices Relief Act will lower high gas prices and deliver much-needed economic relief to Americans across the country by suspending the 18.4 cents per gallon federal gas tax until January 1, 2023 and ensure tax savings are delivered to Americans and not oil and gas companies," Blumenthal's office wrote in a Monday release.
State Sen. Heather Somers, R-Groton, and other Republicans said they were supportive of Blumenthal's efforts.
"We also demand that Senator Blumenthal follow through on his proposal to suspend the federal gas tax and urge Governor (Ned) Lamont to demand that President Biden implement this tax cut immediately," Somers, ranking member of the Transportation Committee, said in a Thursday news release. "If Senator Blumenthal supports a federal gas tax suspension, then he should also support a state gas tax suspension and push his Democratic colleagues here in Connecticut to adopt this proposal immediately."
State Sen. Cathy Osten, D-Sprague, who is co-chair of the Appropriations Committee, had reservations about fully pausing the tax.
"My problem is the gross receipts, which is at 26 cents right now, is paid by the wholesaler, and their policy holds no guarantee that the tax is required to be passed off to the consumer," Osten said. "Whatever we do with all of this, and I think we should look at the gas tax, we have to make sure it's going to have an impact on the consumer, not an impact on wholesalers or owners of gas stations."
State Rep. Christine Conley, D-Groton, echoed other Democrats in saying she is open to the idea of temporarily suspending the tax but wants to investigate the issue further. "I would like to make sure that we are not canceling or delaying any roadway projects using the income of the gas tax," she said. "I hope there will be a public conversation with the Department of Transportation so that we know what the effect is on municipalities."
Republicans argued on Thursday that the revenue loss will be minimal for two reasons: inflation has resulted in a revenue windfall, and because of an influx of COVID-19 pandemic-related federal funds.
House Republican Leader Vincent Candelora, R-North Branford, said rising gas prices are having a similar effect to the pandemic in that it is keeping people inside. "We have surplus after surplus, we have federal money that's come in, and I think this is an issue that's COVID-related," he said.
State Rep. Devin Carney, House ranking member of the Transportation Committee, said people in Connecticut are in need of relief from high gas prices.
"It's not going to make the price of gas go down astronomically," Carney said of the Republican proposal, "but we should not be profiting because of a war Vladimir Putin is putting on the whole world."
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