OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

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

HB-6001

AN ACT IMPLEMENTING PROVISIONS OF THE STATE BUDGET FOR THE FISCAL YEAR BEGINNING JULY 1, 2012.

AMENDMENT

LCO No.: 5820

OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 13 $

FY 14 $

Department of Revenue Services

GF - Net Revenue Gain

14.3-16.3 million

None

Note: GF=General Fund

Municipal Impact: None

Explanation

The amendment enacts a temporary Petroleum Products Gross Earnings Tax (PGET) rate decrease, which is more than offset by a temporary reduction in the Earned Income Tax Credit (EITC) . This results in a one-time net revenue gain of $14.3-$16.3 million in FY 13.

The amendment lowers, from 7.0% to 2.0%, the PGET rate on gasoline or gasohol for July and August of 2012. Assuming approximately 269, 270, 000 taxable gallons are sold during this period, this is estimated to result in a revenue loss of $42.0 million-$44.0 million in FY 13 only. To the extent that lower prices result in additional sales occurring within the state, the revenue loss could be reduced.

The amendment also lowers, from 30% to 15% of the federal EITC, the state EITC for the 2012 income year. This results in a revenue gain of $58.3 million in FY 13 only.

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.