Connecticut Senate Bill SB00171

Connecticut 2017 Regular Session

• Introduced: 1/18/17
• Refer: 1/18/17

Caption

An Act Phasing Out The Real Estate Conveyance Tax.

Impact

If passed, SB00171 would significantly alter the current framework of real estate taxation in the state. By phasing out the real estate conveyance tax, the bill aims to encourage property transactions, potentially leading to greater economic activity in the housing sector. Proponents argue that reducing taxes related to property transfers will make home buying more accessible and stimulating for residents. This could also attract new homebuyers, further reinvigorating local economies as more transactions occur without the added tax burden.

Summary

SB00171, titled 'An Act Phasing Out The Real Estate Conveyance Tax,' proposes to eliminate the real estate conveyance tax over a phased period of four years. The bill introduces a 50% reduction in the tax rate to be remitted to the state in the first year, followed by complete elimination in the second year. Additionally, the bill outlines that in the third year, there will again be a 50% reduction in the tax retained by municipalities, culminating in complete elimination by the fourth year. The intent behind this bill is to alleviate the financial burden associated with real estate transactions, thereby promoting property sales and enhancing housing market activity within the state.

Contention

However, critics of the bill raise concerns about the long-term impact of withdrawing this tax, particularly on municipal revenues. The conveyance tax contributes to funding for local services and infrastructure, and its elimination may lead to significant budget shortfalls for municipalities. This has sparked debates regarding the balance between promoting economic growth through reduced taxation and maintaining essential funding for community services. The discussions around SB00171 highlight the ongoing struggle between state and local government interests, particularly in how tax policy can influence municipal stability and resource allocation.