Connecticut Gas Prices Rising Despite Tax Pause

Both Democrats and Republicans in Hartford worked for and celebrated the Connecticut gasoline-tax suspension that Gov. Ned Lamont (D) signed in late March, but new data indicate its effect could be lessening.

The center-right Yankee Institute (YI) published an analysis on Saturday showing that the difference between gasoline costs in Connecticut and those in Massachusetts, which did not enact a similar gas-tax holiday, are narrowing.

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Lawmakers Call for Challenge to ARPA Rules Limiting Connecticut Tax Reduction

Ned Lamont

Connecticut Republican legislators said on Saturday they want the state to challenge a part of the American Rescue Plan Act which limits states’ ability to cut taxes.

GOP senators and representatives are calling for tax reduction beyond the targeted relief backed by Gov. Ned Lamont (D). A major roadblock to greater decreases will be the COVID-relief bill President Joe Biden signed into law last year. The act included $195.3 billion in recovery funds for states and barred states accepting allocations from using them to “directly or indirectly offset a reduction in net tax revenue… or delay the imposition of any tax or tax increase.”

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Lamont Proposes Connecticut Gas Tax Suspension; Republicans Press for Vote

Gov. Ned Lamont (D) this week proposed a holiday from the state’s 25-cent-per-gallon gasoline tax to last through the month of June.

He said he does not believe the gas-tax break can be extended beyond July 1 insofar as Connecticut’s acceptance of federal funds under President Joe Biden’s American Rescue Plan Act (ARPA) restricts the state as to how much it can reduce taxes. The governor also voiced concern that a longer tax holiday would compromise the state’s ability to fund transportation. The gas tax’s suspension will cost the state over $90 million.

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