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New Laws, New Taxes Take Effect July 1

Recently passed state laws include a bevy of new Connecticut taxes.

They were a busy bunch in Hartford this year.

During the 5-month-long 2011 legislative session, the General Assembly passed a wide range of bills changing the rules on everything from finance and taxation to social policy. With the first Democratic governor in 20 years and a Democratic majority in the statehouse, it proved to be one of the busiest sessions in recent years.

It also proved to be one of the most expensive for state residents: Lawmakers enacted the largest tax increase in the state’s history.

Some of the headline-grabbing laws won’t actually go into effect until Oct. 1 at the earliest. Here, Patch takes a look at the interesting, consequential and polarizing acts slated to go into effect on July 1.

BIGGEST IMPACT

The Budget. The General Assembly passed a $40.1 billion budget. It contains $1.4 billion in tax increases, about $800 million in spending cuts, and $1.6 billion in union concessions. But last week, the union membership failed to ratify the concessions deal and the governor called a special session of the legislature for Thursday so the state can approve a budget by start of fiscal year on July 1.

Sales and Use Taxes. People will soon face myriad new and increased taxes. Here they are:

  • The general sales and use tax rate increases from 6 to 6.35 percent;
  • The room occupancy tax increases from 12 to 15 percent;
  • Tax on renting or leasing a car for 30 days or less increases to 9.35 percent;
  • Luxury tax of an additional 0.65 percent added to the 6.35 percent sales tax — for a total of 7 percent — for cars purchased for more than $50,000; boats more than $100,000; jewelry more than $5,000; clothing or footwear, handbag, luggage, umbrella, wallet or watch more than $1,000;
  • Valet parking provided at any airport will now be taxed;
  • Yoga instruction provided at a yoga studio will now be taxed;
  • Motor vehicle storage services will now be taxed;
  • Packing and crating services will now be taxed;
  • Motor vehicle towing and road services, and livery services will now be taxed;
  • Pet grooming, pet boarding services, and pet obedience services will now be taxed;
  • Services in connection with a cosmetic medical procedure will now be taxed;
  • Manicure services, pedicure services and all other nail and spa services  will now be taxed;
  • Clothing and footwear under $50 will now be taxed;
  • Nonprescription drugs and medicines, and smoking-cessation products will now be taxed; and
  • Cloth or fabric for noncommercial sewing, and yarn for noncommercial use,  will now be taxed.

Diesel Tax. At 46 cents, Connecticut now has the highest diesel tax in the nation. Some worry truckers will fill up at the border, zoom through and leave Connecticut diesel users to foot the bill.

Sin Taxes. Cigarette taxes are rising 40 cents a pack and the alcoholic beverage tax increases by 20 percent.

INTERESTING

Bosnian Affairs Commission. The commission shall consist of 21 members. To focus on ensuring the Bosnian American population of the state are healthy, safe, achieve educational success, are economically self-sufficient, and free from discrimination.

Divesting from Iran. The state treasurer will look at the state’s holdings in companies doing business with Iran and the Sudan and encourage those businesses to divest.

Dairy-Aid. Legislators made permanent the agricultural sustainability account established in 2009, which supports a grant program for dairy farmers. The same law also makes permanent a $10 increase (from $30 to $40) in the fee people pay when filing documents with town clerks and credits $10 of each fee to the agricultural sustainability account.

Thermal Receipt Ban. A ban on Bisphenol-A, or BPA, an ingredient used in thermal receipt paper. So when you're paying more taxes at the pump, know that the receipt coming out of the machine is free of cancer-causing substances.

Paint Stewardship. Connecticut is the third state in the nation to require paint manufacturers to safely manage leftover latex and oil-based paint from households and painting contractors. There will be more and better recycling opportunities for architectural paint.

SOCIAL ISSUES

In-State Tuition for Undocumented Immigrants. Undocumented immigrants who are residents of Connecticut and graduated from a Connecticut high school are eligible for in-state tuition status. They must file an affidavit with the college stating they are in the process of legalizing their immigration status, or that they intend to do so as soon as they can apply.

Good behavior. This law permits the Department of Correction commissioner to reduce an inmate’s maximum prison sentence and make inmates eligible for early release from prison for good behavior. Only inmates convicted of the following crimes are ineligible for the credits: murder, capital felony, felony murder, arson murder, home invasion, and 1st-degree aggravated assault. That means rapists and sex offenders are eligible for the initiative.

Marijuana Possession. This decriminalizes adult possession of up to a half-ounce of marijuana. If caught with less than the said amount, it’s a non-criminal infraction punishable by a fine, no jail, and no criminal record.

No New Hookah Lounges. The state is still moving toward a total ban on hookah lounges, but in the meantime it has banned new hookah lounges, where customers share flavored tobacco smoked from a common pipe.

Paid Sick Leave. Connecticut became the first state in the nation to require paid sick leave to certain private-service workers. Employers with 50 or more employees must provide paid sick leave at a rate of one hour per 40 hours worked.

“Amazon” Tax. Certain remote sellers, including such online retailers as Amazon.com and Overstock.com, who have no physical presence in Connecticut, must now collect sales tax on their taxable sales in the state. The requirement applies to sellers who pay commissions to people located in Connecticut to refer customers to them.

PUBLIC SAFETY

Cell Phone Fine Increase. Using a cell phone or texting while driving just got more expensive. First-time offenders will now be fined $125, up from $100; a second offense means an increase from $150 to $250, and for subsequent offenses from $200 to $400. Anyone caught texting while driving a commercial motor vehicle could be disqualified from operating a commercial motor vehicle. But it allows texting from these vehicles in an emergency.

Boating Under the Influence. Friends don’t let friends boat drunk. Effective July 1, a conviction for reckless boating results in the suspension of a person's boating rights. Police are now allowed to administer a second breathalyzer test within 10 minutes rather than 30 minutes.

School Bullying and Cyberbullying. This bill specifically bans bullying based on a student's actual or perceived “differentiating” characteristics, such as race, gender, sexual orientation or physical appearance. It also prohibits “cyberbullying” -- bullying using electronic communications or devices.

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Susan Schoenberger June 29, 2011 at 06:43 PM
It's time to wrap up the conversation on this story. Future comments will be deleted.
Pat Ryan July 01, 2011 at 04:21 PM
I'm very upset about these taxes, how did we get to this point? Our government is out of control. People need to take the power back!
Pat Ryan July 01, 2011 at 04:21 PM
Thank you patch for giving people and our community a voice, please don't silence us.
Saul Freedman July 01, 2011 at 05:21 PM
Is there a new Patch policy in place only allowing comments 3 days after a story is published?
Susan Schoenberger July 01, 2011 at 06:09 PM
Editors have discretion to close a comment thread. When discussions lapse into ideological arguments that no longer have relevance to the story, it's time to move on.

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