Connecticuts gas tax holiday providing savings, but impacting small businesses

While Connecticut’s gas tax holiday is saving residents at the pump, the savings just isn’t enough, one industry expert says.

Chris Herb, president of the Connecticut Energy Marketers Association, said the tax holiday that expires June 30 is viewed very highly from consumers.

“Our members report that consumers are generally happy with the results of the gas tax holiday but acknowledge that it is not as big of a savings per fill-up as they would like to see,” Herb told The Center Square. “For example, if you purchase 12 gallons of gas – the 25 cents savings per gallon only amounts to $3. Since general inflation has been eroding the buying power of most families even before fuel prices took off, any relief is welcome.”

Democratic Gov. Ned Lamont recently signed a bill that temporarily waives gas tax across the state to help provide some financial relief to motorists.

“With this bipartisan action, we are taking steps to provide some relief to consumers as they face rising prices due to a number of international dynamics and market instability that go far beyond our state,” Lamont said to NBC Connecticut.

The governor signed the gas tax holiday bill on March 24, which also called for free public transportation through the end of the fiscal year on June 30.

However, Herb said, small businesses were taking a costly hit.

“Since the legislature failed to credit the tax that was paid on the fuel that was in our tanks like the state of Maryland did when they enacted a similar tax holiday a few weeks ago, we estimate that local family-owned gas stations ate between $3 and $5 million in losses since Friday,” he said. “Those are big losses for small businesses to take.”

Gas stations were also hit hard as many consumers were seeking gas elsewhere.

“Since the gas tax is a direct passthrough to motorists, gas stations do not benefit from a suspension of the tax with the exception of locations on the state borders,” Herb said. “We are getting reports of increased sales on the Massachusetts, New York, and Rhode Island borders, where out-of-state residents seem to be willing to make the trip across state lines to fill up and save a bit.”

Fares are also suspended on public buses statewide through this time. In addition, there will be a sales tax holiday through Friday. Eligible items are clothing and footwear under $100.

This article was originally posted on Connecticuts gas tax holiday providing savings, but impacting small businesses