OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

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

sHB-6682

AN ACT CONCERNING THE LICENSING OF NEW AND USED CAR DEALERS.


OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 16 $

FY 17 $

Resources of the General Fund

GF - Potential Revenue Gain

$75,000-187,500

$100,000-$250,000

Department of Motor Vehicles

TF - Revenue Gain

up to $2,100

None

Note: GF=General Fund; TF=Transportation Fund

Municipal Impact: None

Explanation

This bill allows the Department of Motor Vehicles (DMV) to issue a new or used car dealer's license to a licensed car manufacturer that meets the provisions of the bill. The bill is anticipated to result in a revenue gain of up to $2,100 in FY 16 to the Special Transportation Fund. It is anticipated that only one dealer will meet the criteria of the bill and is restricted to three dealerships.

The bill also may result in a potential revenue gain ranging from $100,000 to $250,000 by allowing certain manufacturers to obtain car dealer licenses. The actual revenue gain is dependent upon any potential shift in consumer purchases to Connecticut from another state.

Of the adjacent state, New York State does not currently tax purchases of motor vehicles by nonresidents. Rhode Island does not charge Connecticut residents on the purchase of motor vehicles. Massachusetts does charge sales tax on the purchase of motor vehicles on nonresidents.

The Out Years

The annualized ongoing fiscal impact identified above would continue into the future subject the number of new or used dealers established in Connecticut.