Local Republican state legislators Representative Devin Carney (R-23) and Senator Paul Formica (R-20) have announced that they will propose legislation to eliminate Connecticut’s gross receipts tax on propane.
“After the crazy weather we have experienced in recent years, many people bought generators. They were trying to be proactive in case of another catastrophic event. Now, they are finding out that they are getting taxed for thinking ahead,” said Formica.
“This tax is unconscionable,” Carney said. “The government recommends smart storm preparedness, yet taxes home owners for doing just that. When the legislature meets next session, I intend to propose a bill to create a tax exemption for those using propane for all home and generator use, not just exclusively for heating. I hope my colleagues on the other side of the aisle will do what’s right for the people of Connecticut and support this proposal.”
The State of Connecticut assesses a tax on fuel delivered to a customer who uses a propane tank connected to a generator. This 8.81% tax is assessed on the delivery ticket, even if the propane also supplies an exempt heating use (such as home, pool, hot water, cooking, etc.).
Connecticut law says that in order to be exempt from this tax, the propane “must be used exclusively for heating purposes”. Because the propane to a generator produces electricity and not heat, this tax is assessed on deliveries to tanks which solely supply generators.
“People are frustrated and want some action. I intend to bring this up in my capacity as the ranking member of the Energy and Technology Committee,” added Formica.
The 2016 session of the Connecticut General Assembly begins in February. The legislators said they would be pressing for a public hearing on the issue so that propane users can speak out about the tax.
It has just come to my notice that the State of Connecticut recently passed a law imposing a Gross Receipts Tax of 8.81% on all propane consumed by consumers having a generator connected to their propane tank. We have a 1000 gallon underground propane tank which fuels our domestic cooking and partial heating needs as well as a seasonal pool heater. Two years ago we installed an emergency generator following several incidences of prolonged power failure from CL&P.
As long as the power supply is functioning, the generator uses no propane apart from a brief test run for ten minutes each week. It appears that as a result of installing an emergency generator to compensate for an ureliable electric power service I am to be charged 8.81% extra for all propane deliveries – 99% of which are reqired for other purposes!
This tax is patently absurd and deeply unfair to consumers who endeavor to secure a reliable and efficient solution to home energy consumption. I urge that you consider legislation to eliminate this irrational anomaly.
Peter Eio