OLR Bill Analysis

sHB 5599 (as amended by House “A”)*

AN ACT CONCERNING THE TAXATION OF TELECOMMUNICATIONS COMPANY PROPERTY AND THE TIMELY FILING OF DECLARATIONS.

SUMMARY:

By law, telecommunications companies subject to the statewide personal property tax must annually file a list of their taxable personal property with the Department of Revenue Services (DRS) and the Office of Policy and Management (OPM). This bill requires them to list the property on a town-by-town basis. It also requires the companies to submit to each relevant municipality a list of their personal property located in or allocated to the municipality.

By law, DRS and OPM can audit the companies' submissions. The bill allows any municipality to examine these audits.

By law, telecommunications companies and other businesses must file annual personal property declarations. Under current law, the failure to file a declaration by November 1 (or the deadline set by the assessor if an extension is granted) is subject to a penalty of 25% of the assessment of the property on the list. The bill specifies that a declaration postmarked by the filing deadline is not delinquent and thus not subject to the penalty.

*House Amendment “A” makes a minor change with regard to the postmark that must be on the personal property declaration.

EFFECTIVE DATE: Upon passage and applicable to declarations due on or after November 1, 2008 for the penalty provision; July 1, 2008 for the telecommunications companies provisions.

BACKGROUND

Property Tax on Telecommunications Companies

By law, the personal property of telephone companies is assessed at a statewide mill rate of 47 mills and subject to uniform depreciation rules. Other telecommunications companies can opt for this treatment. The revenue raised is distributed to the towns where the companies own property.

Legislative History

The House referred the bill (File 144) to the Finance, Revenue and Bonding Committee, which favorably reported a substitute that added a requirement that the postmark conform to the requirements that apply to state taxes.

COMMITTEE ACTION

Energy and Technology Committee

Joint Favorable

Yea

21

Nay

0

(03/06/2008)

Finance, Revenue and Bonding Committee

Joint Favorable Substitute

Yea

50

Nay

0

(04/09/2008)