Bill to cap hidden gas tax

WTNH TV

Updated: Feb 20, 2012 2:35 PM

Cheshire, Conn. (WTNH) — A Connecticut state senator wants to put a cap on what's known as the "hidden" gas tax.

Connecticut residents pay a 25 cents a gallon gas tax in addition to the gross receipts tax. That's also known as the "hidden" tax.

The hidden tax keeps growing because it's a percentage, 7% of the wholesale price of gas.

"Therefore, as the price of gas goes up, the petroleum gross receipts tax goes up and there's no limit to it," said State Sen. Len Suzio.

Suzio wants to cap the tax. He's introduced Senate bill number 5, formally known as the petroleum gross earnings tax, calling for the tax to stop growing once the wholesale price hits $3 a gallon. He says that would mean some savings now and more later.

"I'm assuming 8 to 10 cents a gallon immediately today, but where the price of gas is projected to go to $4.50, $4.75, it will save, I'm guessing 20-30 cents by this summer," he said.

He's circulating a petition at gas stations and asking people to call their state senators. He says the tax cap would not hurt the state budget, because no one budgeted for gas prices to get this high.

"We've collected over $100 million of extra gross receipts tax in the last 30 months. I'm talking about over and above what we budgeted," he said.

The price of gas in Connecticut is always above the national average because the gross receipts tax is a percentage and keeps growing the more the price goes up, if this keeps going, Connecticut could soon be the number one state in the nation in terms of how much gas tax folks pay.

Sen. Suzio says if the tax is capped, it will save consumers money as gas prices climb this summer. "Connecticut motorists are sick of the pain at the pump - and so are Connecticut gas station owners," he said in a statement.

According to AAA, the average price of a gallon of gas today is $3.869. That's up four cents from a week ago, and nineteen cents from one month ago.

Some experts say prices could reach $4.25 towards the end of April.

Copyright 2012 WTNH TV. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Political Pulse