Connecticut diesel tax to increase 9 cents per gallon on July 1

HARTFORD, Conn. (AP) – Connecticut’s diesel tax will increase by 9 cents per gallon on July 1 after a scheduled rate adjustment announced Wednesday by Governor Ned Lamont.

The tax, which is currently 40.1 cents per gallon, will rise to 49.2 cents per gallon, according to a letter from Lamont to the top Democrats and Republicans on the General Assembly Tax Drafting Committee and its budget director. . State law requires that it be updated annually, based on a complex formula calculated by the Department of Tax Services that takes into account daily fuel prices at two terminals over the previous 365 days. .

The state’s fixed-price diesel tax was created more than a decade ago to provide predictability for businesses. But this year, it was unclear what the new rate might be, given the sharp rise in prices. Some had predicted the new rate could rise 15 to 20 cents a gallon, including Lamont’s Republican challenger in the 2022 gubernatorial race, Bob Stefanowski.

The rate will remain in effect until June 30, 2023.

Legislative Republicans recently called for a special legislative session to cut taxes beyond the roughly $500 million in revenue changes included in the newly adjusted state budget that was approved mostly by Democrats. GOP lawmakers and Stefanowski have called for the state’s diesel tax to be suspended, arguing that it raises the price of service goods at a time of high inflation.

“Higher costs for goods mean higher inflation and an even more expensive state,” Stefanowski said in a written statement released Wednesday. “I urge Governor Lamont to suspend all state gasoline and diesel taxes to help residents through the current crisis that he and President Biden have created.”

Max Reiss, spokesman for Lamont, said last week that a special session “is not on the table” at this time. Instead, he said, the administration is focused on implementing the various tax cuts that are expected to take effect in the new fiscal year.

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