Posted in: Commentary,
by Gregg Laskoski on Apr 5, 2012 11:21 AM
When so many states try to extract higher gas taxes from us it's especially refreshing when a politician tries -and succeeds- in reducing them. That's what Connecticut State Senator Len Suzio has done.
Suzio organized rallies around the state to inform consumers and get 5,000 petition signatures so that a bill he introduced could effectively reduce what has become the highest taxed gasoline in the nation. That's right, Connecticut residents are paying 53 cents per gallon in state taxes alone. Add the federal tax (18.4 cents per gallon) and it places Connecticut at the top of a list where nobody wants to be, with a combined tax of 71.4 cents per gallon; 4 cents more than both New York and California.
Earlier this week Connecticut Governor Daniel Malloy signed a bill that caps the state's 'Petroleum Gross Receipts Tax'; that's the tax on the wholesale price of gas that goes up proportionally as gasoline wholesale prices go up.
Suzio, a freshman state senator from the 13th District representing Meriden, Cheshire, Middletown and Middlefield, said he began his campaign last year because most people didn't know that Connecticut levies two taxes on gasoline. The official tax is 25 cents per gallon. But the state also levies a hidden gas tax called the "gross receipts tax" on the wholesale price. Since 2010, that hidden tax has risen from 16 cents per gallon to 28 cents per gallon, and there was no limit on how high it could go.
Suzio campaigned to "Cap the hidden gas tax" to bring relief to consumers. He publicized the fact that Massachusetts consumers pay 25 cents per gallon less than consumers in Connecticut, and Rhode Island gas taxes were 19 cents per gallon less than Connecticut.
With the passage of this bill, consumers will save 1.5 cents per gallon and Suzio says, it's just the beginning.
In a phone interview yesterday, Senator Suzio offered the following:
"Our gross receipts tax is a percentage of the price so that tax is going up per gallon. Our tax increases with the price of gas which drives the disparity even higher. There was no cap on it until Wednesday. I advocated for this since last July. We held rallies, collected petition signatures and the Democrats finally relented. The cap was passed and signed into law on Wednesday," said Suzio.
"The cap is now locked in at 23.5 cents per gallon. The law that was passed is permanent. Opposition wanted the tax to remain unchanged. We pressed them on it. We said temporary price gouging is just as bad... You can't reserve the right to resume it next year!"
"This is the first round of a 10-round heavyweight fight. Round 2 is a "2 for 2" tax break; it reduce the gross receipts tax from 7.5 percent to 2 percent during July and August, for two months, the months when most people do their driving for their vacation and things like that," he added.
"That effectively would reduce the gas tax in those two months by about 17 or 18 cents per gallon basically. It would be significant tax relief for two months. The reason why I'm doing it as a temporary thing is because I have not a snowball's chance in hell of getting it permanent. What I'm doing with this is sparring with them, hitting them with some jabs to get them to gradually relinquish and lower the tax."
Suzio said that based on the volume of gasoline sold in July and August it represents about $33 million in uncollected revenue and opposition fought him until they recognized the broad grassroots support behind the gax tax reduction efforts.
Suzio maintained that the state receives substantial federal subsidies in lieu of tolls, and, capping the Gross Receipts Tax would not defer maintenance for roads and bridges because the extra money the state had collected from this secondary tax was deposited directly into the state's General Fund for general annual expenditures. Not one penny of that revenue was used for its intended transportation-related purpose.
"At first, most people told us that 'the cap only saves them about a 1 penny or two per gallon right now...' and I tell them 'That's true, but you've got to understand that the last time we did anything to reduce taxes in the state was about 12 or 13 years ago.'
"It's been more than a decade of one tax increase after another. Changing the psychology up here was monumental. I'm fighting a guerrila war on behalf of the taxpayers and you've got to pick and choose your battles and take fights you can win."
So it's a win for Suzio and, more importantly, for all Connecticut residents and motorists. Why aren't more elected officials willing to fight like that?