Carbon Tax on Heating Oil, Gas Being Considered in Connecticut

A legislative bill would impose a new tax on heating oil, natural gas and gasoline in the form of a carbon tax.

The fee is calculated based on a rate of $15 per ton of carbon dioxide equivalent that would be released by burning fossil fuel, according to language in the bill. Biofuels wouldn't be taxed.

The rate would start in 2019 and would be set to increase $5 each year unless a newly-established Carbon Pollution Council decides otherwise.

A tax would also be added to electricity that is generated using fossil fuels.

Taxes collected would be deposited into a restricted clean energy and jobs account within the state's general fund that would be used to help residents and employers transition away from fossil fuel use.

A large portion of the money would also make it's way back to residents and employers in the form of a tax credit.

• 40 percent would go back to residents in the state.
• 30 percent will go to employers in the state
• 25 percent will be used to benefit low-income residential properties and small businesses for use in energy efficiency and renewable energy programs.

Other New England states are looking at similar proposals. The bill would require Massachusetts and Rhode Island to enact a similar fee.

Supporters of the bill say it will help encourage local energy generation, according to CT News Junkie. Those against the bill say it will add yet another tax to companies and residents and that low-income residents who be affected the most.

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