ENOUGH ALREADY

Stop The Gas Tax Hike July 1st

May 1, 2008 (Cromwell, CT) – We already have the highest electric rates in the lower 48 and now gasoline prices are hovering around $3.80 a gallon. Ask yourself how the average family is going to survive in the state?

The State of Connecticut imposes two different taxes on gasoline. The first tax is a flat 25c per gallon excise tax.  The second is a Gross Receipts Tax on the wholesale cost of gasoline, currently at 7.53% of that cost per gallon and that tax today raises another 22c a gallon.  So today the state imposes 47c a gallon tax by itself, and then the federal government comes along and imposes another 18.4c a gallon federal excise tax.  The total state and federal tax burden on a gallon of gasoline today is about 66c per gallon. Your local retailer is selling the gasoline for around $3.14 – state and federal taxes on top of that drive it to an average of $3.80 a gallon.

The Connecticut Gross Receipts Tax on the wholesale price of gasoline is scheduled to go up from 7.53% of the wholesale cost to 8.11% on July 1^st this year.  In the midst of one of the largest run-ups in gasoline prices in the nation’s history our state is going to allow the gross receipts tax to go up on July 1^st – making gasoline even more expensive.  Legislative leaders know this is the case, as does the Governor and yet there is no broad based bipartisan effort to stop the tax hike from going into effect.

Our local families have filled the State coffers at the expense of their vacations, buying clothing and trips to restaurants. Many families near the borders with neighboring states can no longer afford to purchase fuel from their local Connecticut fuel station. Why?  Massachusetts ’s gas taxes are 24c a gallon lower that Connecticut and Rhode Island ’s gas taxes are 16c a gallon less than Connecticut ’s.  Even New York is 8c a gallon less in state gas taxes than Connecticut .

They, along with anyone traveling are finding it more economical to drive to Massachusetts , New York or even Rhode Island and are saving a windfall. While Connecticut is seeing a drop in sales volume of gasoline because consumers are traveling to neighboring states to save 8c-24c or more per gallon, the border stations in Connecticut suffer a loss of business and tax revenue for the state. What good does the rate of Connecticut state taxation do when it serves only to drive business and commerce away from our state to our neighbors?  Look at the states around us, their gas taxes and their AAA average prices –

More bad news on diesel fuel. Last year the legislature dropped the state gross receipts tax on diesel fuel but then raised the state excise tax to 37c a gallon. In addition, that new law allows the state to “look-back” at what the gross receipts tax would have raised in additional revenue, had it been in effect, and raise the excise tax accordingly after July 1^st. It is estimated that the state diesel excise tax will likely go up by another 6c to 9c a gallon to between 43c and 46c a gallon as a result. Every consumer and business that relies on truck deliveries will be paying even more in taxes as a result of yet another state diesel tax increase after July 1^st.

What can be done is a call to your local representative and Governor Rell and let them know these types of taxes are hurting the Connecticut .  Call Governor Rell at 1-800-406-1527.  Call House Democrats at 1-800-842-1902 Call Senate Democrats at 1-800-842-1420. Call Senate Republicans at 1-800-842-1421. Call House Republicans at 1-800-842-1423.

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ICPA represents more than 540 Connecticut based independent businesses. These businesses employ 13,000 Connecticut citizens and supply the majority of our state's 1,600 motor fuels outlets and 350 heating fuels dealers. ICPA's offices are at 10 Alcap Ridge, Cromwell, CT  06416.  For more information about today's Press Release, contact Gene Guilford or Chris Herb.