Raised Bill No. 7176 proposes significant amendments to Connecticut's sales and use tax laws, particularly affecting vehicle sales, the aircraft industry, and the allocation of tax revenues. The bill repeals subdivision (1) of section 12-408 and introduces new provisions effective July 1, 2025, which establish varied tax rates, including a 15% tax on hotel occupancy, a 4.5% tax on motor vehicle sales to active-duty military members, and a 7.75% tax on high-value motor vehicles and jewelry. It also specifies exemptions for certain services, such as Internet access and patient care services. Additionally, the bill modifies the distribution of meals tax revenue, mandating that 10% of hotel occupancy tax revenue be allocated to the Tourism Fund, increasing to 50% for meals tax revenue starting in 2025, and raises the dues tax threshold from $50,000 to $75,000 for certain sales.

Moreover, the bill repeals and replaces subdivision (1) of section 12-411, establishing a 6.35% tax rate on tangible personal property and services while introducing specific rates for categories like hotel stays and luxury items. It also outlines a phased increase in the percentage of tax revenue from motor vehicle sales allocated to the Special Transportation Fund, reaching 100% for sales from July 1, 2022, onward. The bill extends the sales tax exemption period for joint ventures in the aircraft industry from 40 to 50 years and introduces a new exemption for ambulance-type vehicles effective July 1, 2025. Overall, the bill aims to enhance revenue allocation for tourism and transportation while providing targeted tax relief measures for specific industries and organizations.

Statutes affected:
Raised Bill: 12-412, 12-543