The Recent Increase in Gasoline Price Is Explainable and Policymakers Have Tools Available

The Recent Increase in Gasoline Price Is Explainable and Policymakers Have Tools Available

Independent Connecticut Petroleum Association / 10 Alcap Ridge / Cromwell, CT. / Contact: Chris Herb, cell phone 860-712-7725, or Gene Guilford, cell phone 860-989-0756 – Office Phone 860-613-2041

WHAT WE CAN DO ABOUT GASOLINE PRICES WITHOUT KILLING CONNECTICUT BUSINESSES

The recent nationwide increase in gasoline prices is painful, but our state policymakers can do some things that can make a difference in their constituent’s lives without hurting Connecticut businesses that have nothing to do with the increased cost of gasoline.

The Independent Connecticut Petroleum Association would like to recommend several options any one of which or collectively have a real effect on gasoline prices in Connecticut.

  • Resolution by the General Assembly of the State of Connecticut as Senate and House Convened,

Whereas, the Congress of the United States passed a mandate increasing the amount of ethanol to be used in the nation's gasoline supply in the Energy Policy Act of 2005, and

Whereas, the nation’s ethanol producers are not yet ready to meet the total national demand for ethanol to meet the federal mandate; and

Whereas, recently the price of gasoline has been dramatically increasing as a result of this federal mandate and lack of ethanol supply, therefore

We, the General Assembly of the State of Connecticut, as Senate and House convened, do hereby call on the Congress of the United States to repeal the mandate regarding the use of ethanol in the nation's gasoline supply so that the public may enjoy the benefits of lower gasoline prices;

  • Resolution by the General Assembly of the State of Connecticut as Senate and House Convened,

Whereas, federal law imposes a 54 cents per gallon import tariff on ethanol, and

Whereas, recently the price of gasoline has soared as a result of the federal mandate requiring the use of more ethanol in the nation’s gasoline supply than domestic production of ethanol can presently meet; and

Whereas, the general public could enjoy lower gasoline prices if this federal import tariff on ethanol were repealed, facilitating the importation of great amounts of ethanol at lower cost, therefore

We, the General Assembly of the State of Connecticut, as Senate and House convened, do hereby call on the Congress of the United States to repeal the 54 cents per gallon import tariff on ethanol so that the public may enjoy the benefits of lower gasoline prices;

  • Resolution by the General Assembly of the State of Connecticut as Senate and House Convened,

Whereas, the Congress of the United States passed a mandate reducing the amount of sulfur contained in the nation's gasoline supply, and

Whereas, recently the price of gasoline has been dramatically increasing as a result of this federal mandate, therefore

We, the General Assembly of the State of Connecticut, as Senate and House convened, do hereby call on the Congress of the United States to delay the mandate reducing the sulfur content in the nation's gasoline supply so that the public may enjoy the benefits of lower gasoline prices;

  • Fix the Gross Earning Tax to a flat cents per gallon. Today, the Gross Earning Tax is a percentage of the cost of each sale of gasoline and the tax has a dramatic impact on the final cost of gasoline opposed to a flat cents per gallon.
  • Freeze the increase in the Gross Earning Tax. The Gross Earning Tax is scheduled to grow to from 5.8% to 7% by 2008 and eventually 8.1% in 2013 http://www.ct.gov/drs/cwp/view.asp?A=1514&Q=295844. A freeze on the Gross Earning Tax would help cap the potential increase in the cost of gasoline.
  • Excise tax holiday on gasoline. Connecticut has one of the highest gasoline taxes in the region. A suspension in the state excise tax would have an immediate impact on the cost of gasoline. If we combine the state excise tax and the state gross earning tax, that is 41c per gallon of immediate relief.
  • Pass S.B. 502, AN ACT CONCERNING UNFAIR TRADE PRACTICES AND CASH DISCOUNTS FOR GASOLINE, http://www.cga.ct.gov/2006/FC/2006SB-00502-R000104-FC.htm. This bill would allow gasoline retailers that are prohibited from offering a cash discount for purchasing gasoline to do so having an immediate effect on lowering the cost of gasoline.
  • Pass H.B. 5670, AN ACT CONCERNING ENERGY RESOURCE MARKET DISRUPTION EMERGENCIES AND PRICE GOUGING, http://www.cga.ct.gov/2006/FC/2006HB-05670-R000249-FC.htm. This bill would further protect consumers from unscrupulous gasoline retailers who would take advantage of motorists during price spikes.

Every legislative proposal raised in the General Law Committee concerning gasoline this year was defeated because no proposal considered would have any impact on the price of gasoline. The language in LCO 3730 would hurt Connecticut businesses and do nothing to help reduce the price of gasoline. All of the items on the list above could reduce the price of gasoline immediately.

ICPA Represents 500 Connecticut-based

businesses and their 13,000 employees

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