The proposed General Assembly Committee Bill No. 2 aims to amend existing tax laws to bolster local commerce by introducing various exemptions and adjustments related to the sale and service of gas, electricity, and other utilities. Effective October 1, 2026, the bill repeals and replaces subdivision (3) of section 12-412, establishing exemptions for gas and electricity used in residential, agricultural, and industrial settings, with specific conditions for the latter two. It also introduces a new exemption for commercial or industrial businesses with gross income not exceeding ten million dollars and clarifies the definition of bottled gas to specifically refer to L.P. (propane) gas. Additionally, the bill modifies subdivision (1) of section 12-408, maintaining a sales tax rate of six and thirty-five-hundredths percent while outlining specific rates for various services and products, including a new one percent tax on meals sold by eating establishments and certain beverages.

Moreover, the bill establishes the Connecticut-India Trade Commission to enhance trade relations between Connecticut and India, with members appointed from the General Assembly, the Governor's office, and the Indian community. The commission will report annually on its activities and recommendations. The bill also mandates that fifty percent of the tax revenue from meals sold be allocated to the Tourism Fund and the municipal diversification account, starting October 1, 2026. It includes provisions for the disaggregation of sales data by town for retailers with sales in multiple municipalities and requires the Commissioner of Revenue Services to maintain an accounting of amounts deposited in the municipal diversification account. Overall, the bill seeks to create a more favorable tax environment for local businesses while ensuring essential services remain accessible and affordable.

Statutes affected:
Committee Bill: 12-408d