Drawing of State Library BuildingConnecticut State Library Home

Connecticut Public Acts 1996

Previous Page TOC Next Page Public Acts Listings


Substitute House Bill No. 5611

PUBLIC ACT NO. 96-205

AN ACT ELIMINATING THE GROSS RECEIPTS TAX ON STEAM.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Section 12-264 of the general statutes, as amended by sections 2 and 3 of public act 95-114, sections 1 and 2 of public act 95-172 and sections 14 and 15 of public act 95-359, is repealed and the following is substituted in lieu thereof:

(a) Each (1) Connecticut municipality or department or agency thereof, or Connecticut district, manufacturing, selling or distributing gas or electricity to be used for light, heat or power, in this chapter and in chapter 212a called a "municipal utility", (2) company the principal business of which is manufacturing, selling or distributing gas, electricity or steam to be used for light, heat or power, including each foreign municipal electric utility as defined in section 12-59 and given authority to engage in business in this state pursuant to the provisions of section 16-246c, and (3) company required to register pursuant to section 1 of [this act] PUBLIC ACT 95-114 shall pay a quarterly tax upon gross earnings from such operations in this state. Gross earnings from such operations under subdivisions (1) and (2) of this subsection shall include (A) all income classified as operating revenues by the Department of Public Utility Control in the uniform systems of accounts prescribed by said department for operations within the taxable quarter and, with respect to each such company, (B) all income classified in said uniform systems of accounts as income from merchandising, jobbing and contract work, (C) income from nonutility operations, (D) revenues from lease of physical property not devoted to utility operation, and (E) receipts from the sale of residuals and other by-products obtained in connection with the production of gas, electricity or steam. Gross earnings from such operations under subdivision (3) of this subsection shall be gross income from the sales of natural gas. Gross earnings of a gas company, as defined in section 16-1, AS AMENDED shall not include income earned in a taxable year commencing prior to January 1, 2000, from the sale of natural gas or propane as a fuel for a motor vehicle. No deductions shall be allowed from such gross earnings for any commission, rebate or other payment, except a refund resulting from an error or overcharge, and those specifically mentioned in section 12-265, AS AMENDED BY SECTION 2 OF THIS ACT. GROSS EARNINGS OF A COMPANY AS DESCRIBED IN SUBDIVISION (2) OF THIS SUBSECTION SHALL NOT INCLUDE INCOME EARNED IN ANY TAXABLE QUARTER COMMENCING ON OR AFTER JULY 1, 2000, FROM THE SALE OF STEAM.

(b) Each such company and municipal utility shall, on or before the last day of January, April, July and October of each year, render to the Commissioner of Revenue Services under oath of its treasurer, or the person performing the duties of treasurer, or of an authorized agent or officer, a return on forms prescribed or furnished by the commissioner specifying (1) the name and location of such company or municipal utility, (2) the amount of gross earnings from operations for the quarter ending with the last day of the preceding month, (3) the gross earnings from the sale or rental of appliances using water, steam, gas or electricity and the cost of such appliances sold, cost to be interpreted as net invoice price plus transportation costs of such appliances, (4) the gross earnings from all sales for resale of water, steam, gas and electricity, whether or not the purchasers are public service corporations, municipal utilities, located in the state or subject to the tax imposed by this chapter, (5) the number of miles of water or steam pipes, gas mains or electric wires operated by such company or municipal utility within this state on the first day and on the last day of the calendar year immediately preceding, and (6) the number of miles of water or steam pipes, gas mains or electric wires wherever operated by such company or municipal utility on said dates. Gas pipeline and gas transmission companies which do not manufacture or buy gas in this state for resale in this state shall be subject to the provisions of chapter 208 and shall not be subject to the provisions of this chapter and chapter 212a.

Sec. 2. Section 12-265 of the general statutes, as amended by section 4 of public act 95-114 and section 16 of public act 95-359, is repealed and the following is substituted in lieu thereof:

(a) As used in this section (1) with regard to electric power, "sales for resale" include (A) sales of electric power capacity, (B) power output from such capacity, and (C) all transmission charges in conjunction with such sales on or after May 17, 1982, and (2) "net invoice price" means invoice price less trade discounts.

(b) (1) Each company and municipal utility included in section 12-264 AS AMENDED BY SECTION 1 OF THIS ACT shall be taxed at the rate of five per cent upon the amount of gross earnings in each taxable quarter from operations, except as set forth in subsection (c) OR (d) of this section and except that each company and municipal utility manufacturing, selling or distributing gas or electricity to be used for light, heat or power shall be taxed at the rate of four per cent upon the amount of gross earnings in each taxable quarter allocable to residential service, but deduction shall be made of gross earnings (A) from all sales for resale of water, steam, gas and electricity to public service corporations and municipal utilities, whether or not such purchasers are Connecticut public service corporations or Connecticut municipal utilities, and whether or not they are subject to the tax imposed by this chapter, (B) from any federal BTU energy tax included in adjustment clause and base-rate revenues, (C) from sales of appliances using water, steam, gas or electricity by each such company of the net invoice price plus transportation costs of such appliances, (D) of electric and gas companies, as defined in section 16-1, AS AMENDED from energy conservation loan programs and (E) from all sales for resale of gas to companies registered pursuant to section 1 of public act 95-114. (2) Gross earnings for any taxable quarter, for the purposes of assessment and taxation, shall be as follows: (A) In the case of a company or municipal utility carrying on business or operating entirely within this state, the amount of gross earnings from operations; (B) in the case of a company or municipal utility carrying on business or operations a part of which is outside of this state, (i) such portion of the amount of gross earnings from operations determined under the provisions of section 12-264 AS AMENDED as is represented by the ratio of the number of miles of water or steam pipes, gas mains or electric wires operated by such company or municipal utility within this state on the first day and on the last day of the calendar year immediately preceding to the total number of miles of water or steam pipes, gas mains or electric wires operated by such company or municipal utility on said dates; or (ii) in the case of a company required to register pursuant to section 1 of public act 95-114, such portion of the amount of gross earnings from operations determined under the provisions of section 12-264 AS AMENDED BY SECTION 1 OF THIS ACT as is represented by the ratio of the sales in this state to end users during such quarter to the total sales everywhere to end users during such quarter.

(c) The rate of tax on the sale, furnishing or distribution of electricity or natural gas for use directly by a company engaged in a manufacturing production process, in accordance with the Standard Industrial Classification Manual, United States Office of Management and Budget, 1987 edition, classifications 2000 to 3999, inclusive, shall be four per cent with respect to calendar quarters commencing on or after January 1, 1994, and prior to January 1, 1995, three per cent with respect to calendar quarters commencing on or after January 1, 1995, and prior to January 1, 1996, and two per cent with respect to calendar quarters commencing on or after January 1, 1996, and prior to January 1, 1997. The sale, furnishing or distribution of electricity or natural gas for use by a company as provided in this subsection shall not be subject to the provisions of this chapter with respect to calendar quarters commencing on or after January 1, 1997. Not later than thirty days after May 19, 1993, and thirty days after the effective date of each rate decrease provided for in this section each electric and gas public service company, as defined in section 16-1, AS AMENDED which does not have a proposed rate amendment under section 16-19 pending before the Department of Public Utility Control at such time, shall request the department to reopen the proceeding under section 16-19 on the company's most recent rate amendment, solely for the purpose of decreasing the company's rates to reflect the decreases required under this section. The department shall immediately reopen such proceedings, solely for such purpose.

(d) THE RATE OF TAX ON THE SALE, FURNISHING OR DISTRIBUTION OF STEAM FOR USE BY A COMPANY, AS DESCRIBED IN SUBDIVISION (2) OF SUBSECTION (a) OF SECTION 12-264, AS AMENDED BY SECTION 1 OF THIS ACT, SHALL BE: (1) FOUR PER CENT WITH RESPECT TO CALENDAR QUARTERS COMMENCING ON OR AFTER JULY 1, 1996, AND PRIOR TO JULY 1, 1997; (2) THREE PER CENT WITH RESPECT TO CALENDAR QUARTERS COMMENCING ON OR AFTER JULY 1, 1997, AND PRIOR TO JULY 1, 1998; (3) TWO PER CENT WITH RESPECT TO CALENDAR QUARTERS COMMENCING ON OR AFTER JULY 1, 1998, AND PRIOR TO JULY 1, 1999; AND (4) ONE PER CENT WITH RESPECT TO CALENDAR QUARTERS COMMENCING ON OR AFTER JULY 1, 1999, AND PRIOR TO JULY 1, 2000. THE SALE, FURNISHING OR DISTRIBUTION OF STEAM AS PROVIDED IN THIS SUBSECTION SHALL NOT BE SUBJECT TO THE PROVISIONS OF THIS CHAPTER WITH RESPECT TO CALENDAR QUARTERS COMMENCING ON OR AFTER JULY 1, 2000.

Sec. 3. This act shall take effect July 1, 1996.

Approved June 4, 1996. Effective July 1, 1996.

[footer.htm]