The bill, designated as sSB84, proposes significant changes to Connecticut's tax structure and revenue framework, particularly focusing on the corporation business tax, tax credits, and municipal funding. Key provisions include the decoupling of the state corporation business tax from federal bonus depreciation for qualified production property starting in the 2026 income year, and the introduction of a refundable tax credit for small businesses engaged in research and development (R&D) activities, capped at $1.5 million per business and $25 million statewide. The bill also modifies the volatility cap threshold for fiscal year 2026, reduces transfers from the General Fund to the Municipal Revenue Sharing Fund, and eliminates various occupational license fees for healthcare professionals. Additionally, it consolidates the cannabis tax into a single 10.75% excise tax on gross receipts, increasing the allocation to the social equity and innovation account.

Furthermore, the bill addresses municipal funding by shifting aid sources and increasing certain tax exemptions, such as raising the sales price threshold for motor vehicles subject to sales tax from $50,000 to $75,000 and expanding the sales tax exemption for clothing and footwear. It also introduces a refundable tax credit for milk producers based on production costs and modifies the tax structure for peer-to-peer car sharing. The effective dates for various provisions vary, with some taking effect upon passage and others set for July 1, 2026, or October 1, 2026. Overall, sSB84 aims to streamline tax processes, enhance economic development initiatives, and provide financial relief to specific sectors while adjusting the state's revenue framework.

Statutes affected:
Governor's Bill: 20-12j, 20-86g, 20-74h, 20-334a, 20-334e, 20-335
FIN Joint Favorable Substitute: 20-12j, 20-86g, 20-74h, 20-334a, 20-334e, 20-335, 12-407e, 12-263t, 12-263v, 12-263x, 3-114s
File No. 704: 20-12j, 20-86g, 20-74h, 20-334a, 20-334e, 20-335, 12-407e, 12-263t, 12-263v, 12-263x, 3-114s