OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

http: //www.cga.ct.gov/ofa

SB-1239

AN ACT CONCERNING THE BUDGET FOR THE BIENNIUM ENDING JUNE 30, 2013.

AMENDMENT

LCO No.: 5819

OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 12 $

FY 13 $

Department of Revenue Services

GF - Reduces Revenue Gain in Bill

823.2 million

610.9 million

Department of Revenue Services

TF - Reduces Revenue Gain in Bill

17.4 million

17.4 million

Note: GF=General Fund; TF=Transportation Fund

Municipal Impact:

Municipalities

Effect

FY 12 $

FY 13 $

All Municipalities

Reduces Revenue Gain in Bill

109.6 million

116.2 million

Explanation

The amendment reduces the revenue gain in the bill by removing various sections of the underlying bill. The table below outlines the sections removed and the associated fiscal impact of those changes.

Section

Description of the changes

Fund or Municipal Impact

FY 12

FY 13

FY 12

FY 13

   

State Impact ($ - millions)

Aggregate Municipal Impact ($ - millions)

76 & 79

Increase the Corporate Tax surcharge from 10% to 20% and extend until 2013

General Fund

46. 0

116. 0

   

83

Increase tax on other tobacco products from 27. 5% to 50. 0% of the wholesale price

General Fund

3. 7

3. 7

   

83

Increase the tax on snuff from $0. 55 to $1. 00 per ounce

General Fund

1. 4

1. 4

   

84-87, 119

Lower the estate and gift tax threshold from $3. 5 million to $2. 0 million, and extend the existing 7. 2% rate to estates and gifts valued at between $2. 0 million and $3. 5 million.

General Fund

22. 4

22. 4

   

93-94, 97, 126-127

Increase the Sales Tax rate from 6. 00% to 6. 35%, with 0. 1% of the increase to be distributed to municipalities

General Fund / Municipal

138. 4

144. 7

56. 6

59. 0

93, 97

Increase the Sales Tax rate from 6. 35% to 7. 00% on luxury items, as the bill defines

General Fund

3. 6

4. 0

less than 10, 000

less than 10, 000

93-94, 97, 126-127

Increase Room Occupancy Tax rate from 12. 00% to 15. 00%, with 1. 00% of the increase to be distributed to municipalities

General Fund / Municipal

11. 1

11. 6

5. 6

5. 8

93, 97

Increase rental car surcharge to 9. 35%, with 1. 00% of the increase to be remitted to the municipalities in which the transactions occur

General Fund / Municipal

3. 8

4. 0

1. 6

1. 6

98

Increase alcoholic beverages Excise Tax by 20%

General Fund

9. 9

9. 9

   

99

Increase the Excise Tax on the current inventory ("floor tax") of alcohol

General Fund

0. 5

0. 0

   

100

Increase diesel fuel tax by 3 cents to 29 cents per gallon

Special Transportation Fund

8. 5

8. 7

   

101

Increase the Excise Tax on the current inventory ("floor tax") of diesel

Special Transportation Fund

0. 2

0. 0

   

102

Eliminates the sunset of the Municipal Conveyance Tax rate increases

Municipal

0. 0

0. 0

22. 0

24. 0

104

Establish a tax on electric generation from natural gas, coal, oil, and nuclear facilities; due to sunset on June 30, 2013

General Fund

72. 0

72. 0

   

106

Establish a Cabaret Tax, which the state would collect and must remit to the municipalities in which the transactions occur

Municipal

None

None

0. 9

0. 9

99

Increase the Excise Tax on the current inventory ("floor tax") of alcohol

General Fund

0. 5

0. 0

   

100

Increase diesel fuel tax by 3 cents to 29 cents per gallon

Special Transportation Fund

8. 5

8. 7

   

101

Increase the Excise Tax on the current inventory ("floor tax") of diesel

Special Transportation Fund

0. 2

0. 0

   

102

Eliminates the sunset of the Municipal Conveyance Tax rate increases

Municipal

0. 0

0. 0

22. 0

24. 0

104

Establish a tax on electric generation from natural gas, coal, oil, and nuclear facilities; due to sunset on June 30, 2013

General Fund

72. 0

72. 0

   

106

Establish a Cabaret Tax, which the state would collect and must remit to the municipalities in which the transactions occur

Municipal

None

None

0. 9

0. 9

110

Establish an Earned Income Tax Credit equal to 30% of the Federal Level

General Fund

-110. 2

-116. 5

   

107

Increase the marginal Income Tax rates

General Fund

564. 8

399. 1

   

Sections 501 and 502 of the amendment increase the Room Occupancy Tax rate from 12.00% to 15.00% which will result in a revenue increase of $16.7 million in FY 12 and $17.4 million in FY 13.

The fiscal impact of Section 503 is unclear because it is unknown how the Office of the State Treasurer would restructure $1 billion of debt service payable in each of FY 12 and FY 13.

The preceding Fiscal Impact statement is prepared for the benefit of the members of the General Assembly, solely for the purposes of information, summarization and explanation and does not represent the intent of the General Assembly or either chamber thereof for any purpose. In general, fiscal impacts are based upon a variety of informational sources, including the analyst's professional knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.