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General Assembly Raised Bill No. 1106
January Session, 2021
LCO No. 6728
Referred to Committee on FINANCE, REVENUE AND
BONDING
Introduced by:
(FIN)
AN ACT ESTABLISHING THE CONNECTICUT EQUI TABLE
INVESTMENT FUND AND DEDICATING CERTAIN REVENUES TO
SAID FUND.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. (NEW) (Effective January 1, 2022) (a) For taxable years 1
commencing on or after January 1, 2022, there is imposed a surcharge 2
on a taxpayer, excluding trusts or estates, whose Connecticut adjusted 3
gross income is equal to or greater than the threshold amount specified 4
in section 12-700 of the general statutes for imposition of the highest 5
marginal rate on such taxpayer. Such surcharge shall be at the rate of 6
two per cent of the net gain from the sale or exchange of capital assets, 7
as determined for federal income tax purposes. The surcharge shall be 8
in addition to any other tax, fee or surcharge for which the taxpayer is 9
liable. 10
(b) (1) Each taxpayer subject to the surcharge shall file a report with 11
the Commissioner of Revenue Services, in such form and containing 12
such information as the commissioner prescribes, on or before the 13 Raised Bill No. 1106
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fifteenth day of the fourth month following the close of the taxpayer's 14
taxable year. Such return shall accurately set forth the amount of the net 15
gain calculated pursuant to subsection (a) of this section for the 16
preceding taxable year and the amount of the taxpayer's surcharge 17
liability for such year. A taxpayer required to file a report shall, without 18
assessment, notice or demand, pay any surcharge due thereon to the 19
commissioner on or before the date specified in this subsection, 20
determined without regard to any extension of time for filing the report. 21
(2) All revenue collected pursuant to this section and any interest and 22
penalty related thereto shall be deposited in the Connecticut Equity 23
Investment Fund established under section 7 of this act. 24
(c) If any person fails to pay the amount of the surcharge reported 25
due on a report within the time specified, there shall be imposed a 26
penalty equal to ten per cent of such amount due and unpaid, or fifty 27
dollars, whichever is greater. Such amount shall bear interest at the rate 28
of one per cent per month or fraction thereof, from the due date of such 29
surcharge until the date of payment. Subject to the provisions of section 30
12-3a of the general statutes, the commissioner may waive all or part of 31
the penalties provided under this section when it is proven to the 32
commissioner's satisfaction that the failure to pay any surcharge was 33
due to reasonable cause and was not intentional or due to neglect. 34
(d) The provisions of sections 12-550 to 12-554, inclusive, and section 35
12-555a of the general statutes shall apply to the provisions of this 36
section in the same manner and with the same force and effect as if the 37
language of said sections had been incorporated in full into this section 38
and had expressly referred to the surcharge under this section, except to 39
the extent that any provision is inconsistent with a provision in this 40
section. 41
(e) The commissioner may adopt regulations, in accordance with the 42
provisions of chapter 54 of the general statutes, to implement the 43
provisions of this section. 44
Sec. 2. (NEW) (Effective from passage) (a) As used in this section: 45 Raised Bill No. 1106
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(1) "Employer" means an employer required to deduct and withhold 46
tax from wages pursuant to section 12-705 of the general statutes; and 47
(2) "Electing employee" means an employee of an employer, who (A) 48
is required to have amounts withheld from wages pursuant to section 49
12-705 of the general statutes, (B) receives an annual gross income for 50
wages from such employer of more than forty thousand dollars, and (C) 51
elects to participate in the wage compensation tax program established 52
under subsection (b) of this section. 53
(b) (1) There is established, for taxable years commencing on or after 54
January 1, 2022, a wage compensation tax program under which any 55
employee may elect to participate in such program and the employer of 56
such electing employee shall pay a tax on the wages of each employee 57
who elects to participate in such program. 58
(2) There is imposed a tax on each employer that employs an electing 59
employee, in an amount equal to five per cent of such electing 60
employee's wages. Each such employer shall remit the tax to the 61
Department of Revenue Services in accordance with the provisions of 62
subsection (f) of this section. All revenue collected pursuant to this 63
section and any interest and penalty related thereto shall be deposited 64
in the Connecticut Equity Investment Fund established under section 7 65
of this act. 66
(3) Each electing employee shall be allowed (A) a credit against the 67
tax imposed under chapter 229 of the general statutes, as provided in 68
subsection (g) of this section, and (B) a deduction from such electing 69
employee's federal adjusted gross income, as provided in subdivision 70
(20) of subsection (a) of section 12-701 of the general statutes, as 71
amended by this act, for contributions made to a Roth individual 72
retirement account under 26 USC 408A, as amended from time to time. 73
(c) (1) Each employer shall inform its current and newly hired 74
employees of the wage compensation tax program and provide to each 75
employee (A) information about how such employee may elect to 76
participate in such program, and (B) an estimated tax table that provides 77 Raised Bill No. 1106
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projections of what such employee's wages and tax liability under 78
chapter 229 of the general statutes might be if such employee 79
participates in the program and what such wages and tax liability might 80
be if such employee does not participate in the program. 81
(2) No employer may prohibit an employee from participating in 82
such program, except that each employer may establish a reasonable 83
minimum period of time that an electing employee is required to 84
maintain participation in such program. 85
(d) (1) Each employer shall offer to pay, for any individual to whom 86
such employer will be required to issue an Internal Revenue Service 87
Form 1099 for any taxable year commencing on or after January 1, 2022, 88
the tax set forth in subdivision (2) of subsection (b) of this section as if 89
the amount reportable on said form were wages paid by such employer 90
to the individual. Each employer shall provide to each such individual 91
an estimated tax table that provides projections of what such 92
individual's tax liability under chapter 229 of the general statutes might 93
be if the employer paid such tax and what such tax liability might be if 94
such tax is not paid. Each employer that pays the tax under this 95
subdivision shall remit such tax to the Department of Revenue Services 96
in accordance with the provisions of subsection (f) of this section. 97
(2) Each individual for whom an employer has paid the tax under 98
subdivision (1) of this subsection shall be allowed a credit against the 99
tax imposed under chapter 229 of the general statutes, as provided in 100
subsection (g) of this section. 101
(e) The Department of Revenue Services shall assist employers in the 102
preparation of the estimated tax tables required under subsections (c) 103
and (d) of this section. 104
(f) Any employer that is subject to the tax imposed under subsection 105
(b) of this section or the payment of the tax under subsection (d) of this 106
section shall remit such tax to the Department of Revenue Services at 107
the same time and in the same manner such employer would be 108
required to pay the tax under section 12-705 of the general statutes, and 109 Raised Bill No. 1106
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shall file a return in such form and manner as the commissioner 110
prescribes. Any individual who is under a duty to act on behalf of an 111
employer to comply with the provisions of this section shall be jointly 112
and severally liable with the employer for any tax, amount, interest or 113
penalty owed under this section. 114
(g) For taxable years commencing on or after January 1, 2022, each 115
electing employee, and each individual for whom an employer has paid 116
the tax under subsection (d) of this section, shall be allowed a credit 117
against the tax imposed under chapter 229 of the general statutes, in the 118
amount of ninety-five per cent of (1) the taxes paid by the employer of 119
such electing employee on such employee's wages, or (2) the taxes paid 120
on behalf of such individual pursuant to subsection (d) of this section, 121
as applicable. If the amount of the credit allowed pursuant to this 122
subsection exceeds the electing employee's or individual's liability for 123
the tax imposed under chapter 229 of the general statutes, the 124
Commissioner of Revenue Services shall treat such excess as an 125
overpayment and, except as provided under section 12-739 or 12-742 of 126
the general statutes, shall refund the amount of such excess, without 127
interest, to such electing employee or individual. 128
(h) The provisions of sections 12-550 to 12-554, inclusive, and section 129
12-555a of the general statutes shall apply to the provisions of this 130
section in the same manner and with the same force and effect as if the 131
language of said sections had been incorporated in full into this section 132
and had expressly referred to the tax imposed under this section, except 133
to the extent that any such provision is inconsistent with a provision of 134
this section. 135
Sec. 3. Subparagraph (B) of subdivision (20) of subsection (a) of 136
section 12-701 of the general statutes is repealed and the following is 137
substituted in lieu thereof (Effective January 1, 2022, and applicable to 138
taxable years commencing on or after January 1, 2022): 139
(B) There shall be subtracted therefrom: 140
(i) To the extent properly includable in gross income for federal 141 Raised Bill No. 1106
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income tax purposes, any income with respect to which taxation by any 142
state is prohibited by federal law; 143
(ii) To the extent allowable under section 12-718, exempt dividends 144
paid by a regulated investment company; 145
(iii) To the extent properly includable in gross income for federal 146
income tax purposes, the amount of any refund or credit for 147
overpayment of income taxes imposed by this state, or any other state 148
of the United States or a political subdivision thereof, or the District of 149
Columbia; 150
(iv) To the extent properly includable in gross income for federal 151
income tax purposes and not otherwise subtracted from federal 152
adjusted gross income pursuant to clause (x) of this subparagraph in 153
computing Connecticut adjusted gross income, any tier 1 railroad 154
retirement benefits; 155
(v) To the extent any additional allowance for depreciation under 156
Section 168(k) of the Internal Revenue Code for property placed in 157
service after September 27, 2017, was added to federal adjusted gross 158
income pursuant to subparagraph (A)(ix) of this subdivision in 159
computing Connecticut adjusted gross income, twenty-five per cent of 160
such additional allowance for depreciation in each of the four 161
succeeding taxable years; 162
(vi) To the extent properly includable in gross income for federal 163
income tax purposes, any interest income from obligations issued by or 164
on behalf of the state of Connecticut, any political subdivision thereof, 165
or public instrumentality, state or local authority, district or similar 166
public entity created under the laws of the state of Connecticut; 167
(vii) To the extent properly includable in determining the net gain or 168
loss from the sale or other disposition of capital assets for federal income 169
tax purposes, any gain from the sale or exchange of obligations issued 170
by or on behalf of the state of Connecticut, any political subdivision 171
thereof, or public instrumentality, state or local authority, district or 172 Raised Bill No. 1106
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similar public entity created under the laws of the state of Connecticut, 173
in the income year such gain was recognized; 174
(viii) Any interest on indebtedness incurred or continued to purchase 175
or carry obligations or securities the interest on which is subject to tax 176
under this chapter but exempt from federal income tax, to the extent that 177
such interest on indebtedness is not deductible in determining federal 178
adjusted gross income and is attributable to a trade or business carried 179
on by such individual; 180
(ix) Ordinary and necessary expenses paid or incurred during the 181
taxable year for the production or collection of income which is subject 182
to taxation under this chapter but exempt from federal income tax, or 183
the management, conservation or maintenance of property held for the 184
production of such income, and the amortizable bond premium for the 185
taxable year on any bond the interest on which is subject to tax under 186
this chapter but exempt from federal income tax, to the extent that such 187
expenses and premiums are not deductible in determining federal 188
adjusted gross income and are attributable to a trade or business carried 189
on by such individual; 190
(x) (I) For taxable years commencing prior to January 1, 2019, for a 191
person who files a return under the federal income tax as an unmarried 192
individual whose federal adjusted gross income for such taxable year is 193
less than fifty thousand dollars, or as a married individual filing 194
separately whose federal adjusted gross income for such taxable year is 195
less than fifty thousand dollars, or for a husband and wife who file a 196
return under the federal income tax as married individuals filing jointly 197
whose federal adjusted gross income for such taxable year is less than 198
sixty thousand dollars or a person who files a return under the federal 199
income tax as a head of household whose federal adjusted gross income 200
for such taxable year is less than sixty thousand dollars, an amount 201
equal to the Social Security benefits includable for federal income tax 202
purposes; 203
(II) For taxable years commencing prior to January 1, 2019, for a 204 Raised Bill No. 1106
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person who files a return under the federal income tax as an unmarried 205
individual whose federal adjusted gross income for such taxable year is 206
fifty thousand dollars or more, or as a married individual filing 207
separately whose federal adjusted gross income for such taxable year is 208
fifty thousand dollars or more, or for a husband and wife who file a 209
return under the federal income tax as married individuals filing jointly 210
whose federal adjusted gross income from such taxable year is sixty 211
thousand dollars or more or for a person who files a return under the 212
federal income tax as a head of household whose federal adjusted gross 213
income for such taxable year is sixty thousand dollars or more, an 214
amount equal to the difference between the amount of Social Security 215
benefits includable for federal income tax purposes and the lesser of 216
twenty-five per cent of the Social Security benefits received during the 217
taxable year, or twenty-five per cent of the excess described in Section 218
86(b)(1) of the Internal Revenue Code; 219
(III) For the taxable year commencing January 1, 2019, and each 220
taxable year thereafter, for a person who files a return under the federal 221
income tax as an unmarried individual whose federal adjusted gross 222
income for such taxable year is less than seventy-five thousand dollars, 223
or as a married individual filing separately whose federal adjusted gross 224
income for such taxable year is less than seventy-five thousand dollars, 225
or for a husband and wife who file a return under the federal income tax 226
as married individuals filing jointly whose federal adjusted gross 227
income for such taxable year is less than one hundred thousand dollars 228
or a person who files a return under the federal income tax as a head of 229
household whose federal adjusted gross income for such taxable year is 230
less than one hundred thousand dollars, an amount equal to the Social 231
Security benefits includable for federal income tax purposes; and 232
(IV) For the taxable year commencing January 1, 2019, and each 233
taxable year thereafter, for a person who files a return under the federal 234
income tax as an unmarried individual whose federal adjusted gross 235
income for such taxable year is seventy-five thousand dollars or more, 236
or as a married individual filing separately whose federal adjusted gross 237
income for such taxable year is seventy-five thousand dollars or more, 238 Raised Bill No. 1106
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or for a husband and wife who file a return under the federal income tax 239
as married individuals filing jointly whose federal adjusted gross 240
income from such taxable year is one hundred thousand dollars or more 241
or for a person who files a return under the federal income tax as a head 242
of household whose federal adjusted gross income for such taxable year 243
is one hundred thousand dollars or more, an amount equal to the 244
difference between the amount of Social Security benefits includable for 245
federal income tax purposes and the lesser of twenty-five per cent of the 246
Social Security benefits received during the taxable year, or twenty-five 247
per cent of the excess described in Section 86(b)(1) of the Internal 248
Revenue Code; 249
(xi) To the extent properly includable in gross income for federal 250
income tax purposes, any amount rebated to a taxpayer pursuant to 251
section 12-746; 252
(xii) To the extent properly includable in the gross income for federal 253
income tax purposes of a designated beneficiary, any distribution to 254
such beneficiary from any qualified state tuition program, as defined in 255
Section 529(b) of the Internal Revenue Code, established and 256
maintained by this state or any official, agency or instrumentality of the 257
state; 258
(xiii) To the extent allowable under section 12-701a, contributions to 259
accounts established pursuant to any qualified state tuition program, as 260
defined in Section 529(b) of the Internal Revenue Code, established and 261
maintained by this state or any official, agency or instrumentality of the 262
state; 263
(xiv) To the extent properly includable in gross income for federal 264
income tax purposes, the amount of any Holocaust victims' settlement 265
payment received in the taxable year by a Holocaust victim; 266
(xv) To the extent properly includable in gross income for federal 267
income tax purposes of an account holder, as defined in section 31-268
51ww, interest earned on funds deposited in the individual 269
development account, as defined in section 31-51ww, of such account 270 Raised Bill No. 1106
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holder; 271
(xvi) To the extent properly includable in the gross income for federal 272
income tax purposes of a designated beneficiary, as defined in section 273
3-123aa, interest, dividends or capital gains earned on contributions to 274
accounts established for the designated beneficiary pursuant to the 275
Connecticut Homecare Option Program for the Elderly established by 276
sections 3-123aa to 3-123ff, inclusive; 277
(xvii) To the extent properly includable in gross income for federal 278
income tax purposes, any income received from the United States 279
government as retirement pay for a retired member of (I) the Armed 280
Forces of the United States, as defined in Section 101 of Title 10 of the 281
United States Code, or (II) the National Guard, as defined in Section 101 282
of Title 10 of the United States Code; 283
(xviii) To the extent properly includable in gross income for federal 284
income tax purposes for the taxable year, any income from the discharge 285
of indebtedness in connection with any reacquisition, after December 286
31, 2008, and before January 1, 2011, of an applicable debt instrument or 287
instruments, as those terms are defined in Section 108 of the Internal 288
Revenue Code, as amended by Section 1231 of the American Recovery 289
and Reinvestment Act of 2009, to the extent any such income was added 290
to federal adjusted gross income pursuant to subparagraph (A)(xi) of 291
this subdivision in computing Connecticut adjusted gross income for a 292
preceding taxable year; 293
(xix) To the extent not deductible in determining federal adjusted 294
gross income, the amount of any contribution to a manufacturing 295
reinvestment account established pursuant to section 32-9zz in the 296
taxable year that such contribution is made; 297
(xx) To the extent properly includable in gross income for federal 298
income tax purposes, (I) for the taxable year commencing January 1, 299
2015, ten per cent of the income received from the state teachers' 300
retirement system, (II) for the taxable years commencing January 1, 301
2016, to January 1, 2020, inclusive, twenty-five per cent of the income 302 Raised Bill No. 1106
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received from the state teachers' retirement system, and (III) for the 303
taxable year commencing January 1, 2021, and each taxable year 304
thereafter, fifty per cent of the income received from the state teachers' 305
retirement system or the percentage, if applicable, pursuant to clause 306
(xxi) of this subparagraph; 307
(xxi) To the extent properly includable in gross income for federal 308
income tax purposes, except for retirement benefits under clause (iv) of 309
this subparagraph and retirement pay under clause (xvii) of this 310
subparagraph, for a person who files a return under the federal income 311
tax as an unmarried individual whose federal adjusted gross income for 312
such taxable year is less than seventy-five thousand dollars, or as a 313
married individual filing separately whose federal adjusted gross 314
income for such taxable year is less than seventy-five thousand dollars, 315
or as a head of household whose federal adjusted gross income for such 316
taxable year is less than seventy-five thousand dollars, or for a husband 317
and wife who file a return under the federal income tax as married 318
individuals filing jointly whose federal adjusted gross income for such 319
taxable year is less than one hundred thousand dollars, (I) for the taxable 320
year commencing January 1, 2019, fourteen per cent of any pension or 321
annuity income, (II) for the taxable year commencing January 1, 2020, 322
twenty-eight per cent of any pension or annuity income, (III) for the 323
taxable year commencing January 1, 2021, forty-two per cent of any 324
pension or annuity income, (IV) for the taxable year commencing 325
January 1, 2022, fifty-six per cent of any pension or annuity income, (V) 326
for the taxable year commencing January 1, 2023, seventy per cent of any 327
pension or annuity income, (VI) for the taxable year commencing 328
January 1, 2024, eighty-four per cent of any pension or annuity income, 329
and (VII) for the taxable year commencing January 1, 2025, and each 330
taxable year thereafter, any pension or annuity income; 331
(xxii) The amount of lost wages and medical, travel and housing 332
expenses, not to exceed ten thousand dollars in the aggregate, incurred 333
by a taxpayer during the taxable year in connection with the donation 334
to another person of an organ for organ transplantation occurring on or 335
after January 1, 2017; 336 Raised Bill No. 1106
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(xxiii) To the extent properly includable in gross income for federal 337
income tax purposes, the amount of any financial assistance received 338
from the Crumbling Foundations Assistance Fund or paid to or on 339
behalf of the owner of a residential building pursuant to sections 8-442 340
and 8-443; 341
(xxiv) To the extent properly includable in gross income for federal 342
income tax purposes, the amount calculated pursuant to subsection (b) 343
of section 12-704g for income received by a general partner of a venture 344
capital fund, as defined in 17 CFR 275.203(l)-1, as amended from time to 345
time; [and] 346
(xxv) To the extent any portion of a deduction under Section 179 of 347
the Internal Revenue Code was added to federal adjusted gross income 348
pursuant to subparagraph (A)(xiv) of this subdivision in computing 349
Connecticut adjusted gross income, twenty-five per cent of such 350
disallowed portion of the deduction in each of the four succeeding 351
taxable years; and 352
(xxvi) The amount of contributions made during the applicable 353
taxable year by an electing employee, as defined in section 2 of this act, 354
to a Roth individual retirement account under 26 USC 408A, as 355
amended from time to time, provided such electing employee was a 356
participant in the wage compensation tax program established under 357
section 1 of this act during at least six months of the applicable taxable 358
year. 359
Sec. 4. (NEW) (Effective January 1, 2022, and applicable to taxable years 360
commencing on or after January 1, 2022) (a) As used in this section, 361
"resident of the state" has the same meaning as provided in section 12-362
701 of the general statutes. 363
(b) (1) Each resident of this state whose federal adjusted gross income 364
is one hundred forty thousand dollars or more shall be subject to a 365
consumption tax calculated as set forth in subdivision (2) of this 366
subsection. 367 Raised Bill No. 1106
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(2) Each such resident shall multiply the amount of such resident's 368
federal adjusted gross income for the preceding taxable year by the 369
adjustment rate provided herein and shall owe such tax in the resulting 370
amount: 371
T1 Federal adjusted gross income Adjustment rate
T2 $140,000 to less than $185,000 0.1%
T3 $185,000 to less than $300,000 0.5%
T4 $300,000 to less than $600,000 0.7%
T5 $600,000 to less than $2,000,000 0.7%
T6 $2,000,000 to less than $13,000,000 1.4%
T7 $13,000,000 or more 1.5%
(c) (1) Each taxpayer subject to the tax under subsection (b) of this 372
section shall file a report with the Commissioner of Revenue Services, in 373
such form and containing such information as the commissioner 374
prescribes, on or before the fifteenth day of the fourth month following 375
the close of the taxpayer's taxable year. Such return shall accurately set 376
forth the amount of the tax calculated pursuant to subsection (b) of this 377
section for the preceding taxable year. A taxpayer required to file a 378
report for the tax under this subsection shall, without assessment, notice 379
or demand, pay the tax due to the commissioner on or before the date 380
specified in this subsection, determined without regard to any extension 381
of time for filing the report. 382
(2) All revenue collected pursuant to this section and any interest and 383
penalty related thereto shall be deposited in the Connecticut Equity 384
Investment Fund established under section 7 of this act. 385
(d) If any person fails to pay the amount of the tax reported due on a 386
report within the time specified, there shall be imposed a penalty equal 387
to ten per cent of such amount due and unpaid, or fifty dollars, 388
whichever is greater. Such amount shall bear interest at the rate of one 389
per cent per month or fraction thereof, from the due date of such tax 390
until the date of payment. Subject to the provisions of section 12-3a of 391
the general statutes, the commissioner may waive all or part of the 392
penalties provided under this section when it is proven to the 393 Raised Bill No. 1106
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commissioner's satisfaction that the failure to pay any tax was due to 394
reasonable cause and was not intentional or due to neglect. 395
(e) The provisions of sections 12-550 to 12-554, inclusive, and section 396
12-555a of the general statutes shall apply to the provisions of this 397
section in the same manner and with the same force and effect as if the 398
language of said sections had been incorporated in full into this section 399
and had expressly referred to the tax imposed under this section, except 400
to the extent that any such provision is inconsistent with a provision of 401
this section. 402
(f) The commissioner may adopt regulations, in accordance with the 403
provisions of chapter 54 of the general statutes, to implement the 404
provisions of this section. 405
Sec. 5. (NEW) (Effective January 1, 2022) (a) As used in this section: 406
(1) "Annual gross revenues" means income or revenue from all 407
sources, prior to any expenses or taxes, computed in accordance with 408
generally accepted accounting principles; 409
(2) "Assessable base" means the annual gross revenues derived from 410
digital advertising services in the state; 411
(3) "Digital advertising services" means advertisement services on a 412
digital interface, including banner advertising, search engine 413
advertising, interstitial advertising and other comparable advertising 414
services; and 415
(4) "Digital interface" means any type of software, including an 416
Internet web site or a part thereof or an application, that a person is able 417
to access with a device. 418
(b) (1) There is imposed a tax on the annual gross revenue of a person 419
derived from digital advertising services in the state as follows: 420
(A) Two and one-half per cent of the assessable base for a person with 421
global annual gross revenues of one hundred million dollars up to and 422 Raised Bill No. 1106
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including one billion dollars; 423
(B) Five per cent of the assessable base for a person with global annual 424
gross revenues of more than one billion dollars up to and including five 425
billion dollars; 426
(C) Seven and one-half per cent of the assessable base for a person 427
with global annual gross revenues of more than five billion dollars up 428
to and including fifteen billion dollars; and 429
(D) Ten per cent of the assessable base for a person with global annual 430
gross revenues of more than fifteen billion dollars. 431
(2) The Commissioner of Revenue Services shall adopt regulations, in 432
accordance with the provisions of chapter 54 of the general statutes, to 433
establish the methodology to determine the portion of the annual gross 434
revenue of a person derived from digital advertising in the United States 435
to be apportioned to the state for purposes of determining the assessable 436
base under this section. 437
(c) (1) Each taxpayer subject to the tax under this section shall file a 438
report with the Commissioner of Revenue Services, in such form and 439
manner and containing such information as the commissioner 440
prescribes. Such return shall accurately set forth the amount of the tax 441
calculated pursuant to subsection (b) of this section for the preceding 442
income year. 443
(2) All revenue collected pursuant to this section and any interest and 444
penalty related thereto shall be deposited in the Connecticut Equity 445
Investment Fund established under section 7 of this act. 446
(d) If any person fails to pay the amount of the tax reported due on a 447
report within the time specified, there shall be imposed a penalty equal 448
to ten per cent of such amount due and unpaid, or fifty dollars, 449
whichever is greater. Such amount shall bear interest at the rate of one 450
per cent per month or fraction thereof, from the due date of such tax 451
until the date of payment. Subject to the provisions of section 12-3a of 452 Raised Bill No. 1106
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the general statutes, the commissioner may waive all or part of the 453
penalties provided under this section when it is proven to the 454
commissioner's satisfaction that the failure to pay any tax was due to 455
reasonable cause and was not intentional or due to neglect. 456
(e) The provisions of sections 12-550 to 12-554, inclusive, and section 457
12-555a of the general statutes shall apply to the provisions of this 458
section in the same manner and with the same force and effect as if the 459
language of said sections had been incorporated in full into this section 460
and had expressly referred to the tax imposed under this section, except 461
to the extent that any such provision is inconsistent with a provision of 462
this section. 463
Sec. 6. Subsection (i) of section 12-391 of the general statutes is 464
repealed and the following is substituted in lieu thereof (Effective July 1, 465
2021, and applicable to the estates of decedents dying on or after January 1, 466
2021): 467
(i) [The] With respect to the estates of decedents dying on or after 468
January 1, 2021, the tax calculated pursuant to the provisions of this 469
section shall be reduced in an amount equal to half of the amount 470
invested by a decedent in a private investment fund or fund of funds 471
pursuant to [subdivision (43) of section 32-39] section 7 of this act, 472
provided (1) any such reduction shall not exceed five million dollars for 473
any such decedent, and (2) any such amount invested by the decedent 474
shall have been invested in such fund or fund of funds for ten years or 475
more. [, and (3) the aggregate amount of all taxes reduced under this 476
subsection shall not exceed thirty million dollars.] 477
Sec. 7. (NEW) (Effective July 1, 2021) (a) There is established a fund to 478
be known as the "Connecticut Equitable Investment Fund". The fund 479
shall contain any moneys required by law to be deposited in the fund 480
and shall be held in trust separate and apart from all other moneys, 481
funds and accounts. Investment earnings credited to the assets of the 482
fund shall become part of the assets of the fund. Any balance remaining 483
in the fund at the end of any fiscal year shall be carried forward in the 484
fund for the fiscal year next succeeding. Moneys in the fund shall be 485 Raised Bill No. 1106
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expended by the Connecticut Equitable Investment Council established 486
pursuant to subsection (c) of this section to be used for the purposes set 487
forth in this section. The Connecticut Equitable Investment Fund shall 488
be a permanent investment fund to receive, invest and distribute 489
dedicated tax revenues as provided in this section. 490
(b) The following moneys shall be deposited in the fund: 491
(1) The revenues from (A) the surcharge under section 1 of this act, 492
(B) the wage compensation tax under section 2 of this act, (C) the 493
consumption tax under section 4 of this act, and (D) the digital 494
advertising tax under section 5 of this act; 495
(2) The amounts of any private investment received pursuant to 496
subdivision (5) of subsection (c) of this section, to be invested in 497
accordance with the provisions of said subdivision; and 498
(3) (A) The taxes collected and retained by the state on or after July 1, 499
2021, on recreational cannabis and cannabis products, and (B) the 500
revenues generated and retained by the state from any form of online 501
wagering authorized on or after July 1, 2021. 502
(c) (1) There is established the Connecticut Equitable Investment 503
Council, which shall manage and oversee the Connecticut Equitable 504
Investment Fund. The council shall consist of the following members: 505
(A) The Governor, who shall serve as the chairperson of the council; (B) 506
the Treasurer; (C) the Secretary of the Office of Policy and Management; 507
and (D) six members of the public, two of whom shall be appointed by 508
the Governor, two of whom shall be appointed by the president pro 509
tempore of the Senate and two of whom shall be appointed by the 510
speaker of the House of Representatives. 511
(2) The chairperson shall schedule meetings as necessary to 512
implement and accomplish the programs and strategies described in 513
subdivision (3) of this subsection, provided such meetings shall be held 514
not less than once every calendar quarter. 515 Raised Bill No. 1106
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(3) The council shall protect and grow the moneys in the fund for 516
current and future generations through prudent, professional 517
investment management and support the growth of the state's economy 518
through investments-in-place programs and strategies that include, but 519
are not limited to: 520
(A) Building wealth in traditionally underserved communities by (i) 521
attracting and retaining neighborhood wealth, (ii) providing financial, 522
educational or related services to support initiatives that concentrate 523
investments in human capital and infrastructure, (iii) rebuilding 524
community assets through the construction, renovation or repair of 525
neighborhood structures or assets, (iv) providing programs, services 526
and assistance to support community reinvestment, (v) increasing 527
owner-occupancy of residential buildings and supporting pathways to 528
home ownership, and (vi) creating pipelines to employment; 529
(B) Reducing income inequality in the state by (i) providing funding 530
to allow the state to increase the earned income credit under section 12-531
704e of the general statutes to forty per cent of the federal earned income 532
credit claimed and allowed, (ii) compensating worker value over 533
productivity, and (iii) expanding skill development and vocational and 534
technical training opportunities; 535
(C) Retaining and attracting talent to the state by increasing the 536
availability of venture capital; and 537
(D) Working with the state to reduce municipal reliance on property 538
taxes through the establishment of a statewide commercial property tax 539
credit and initiatives to prioritize municipal need and capacity, provide 540
full funding for the grants in lieu of taxes program under section 12-18b 541
of the general statutes, reduce or eliminate intertown tax rate 542
advantages and monetize land use. 543
(4) The council shall establish a review process and standards to 544
evaluate the programs and strategies that will help it and the state 545
achieve the goals described in subdivision (3) of this subsection and 546
shall annually distribute not less than fifty per cent of the moneys in the 547 Raised Bill No. 1106
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fund, excluding the amount of any private investment received 548
pursuant to subdivision (5) of this subsection, that are generated 549
through revenue streams that are less volatile, as determined by the 550
council. 551
(5) The council shall establish a program to solicit private investment 552
from state residents that the council will invest in a private investment 553
fund or funds of funds, provided any such private investment shall be 554
invested in venture capital firms (A) having offices located in the state, 555
and (B) that support the growth of business operations of companies in 556
the state in a manner that support the goals described in subdivision (3) 557
of this subsection. 558
This act shall take effect as follows and shall amend the following
sections:
Section 1 January 1, 2022 New section
Sec. 2 from passage New section
Sec. 3 January 1, 2022, and
applicable to taxable years
commencing on or after
January 1, 2022
12-701(a)(20)(B)
Sec. 4 January 1, 2022, and
applicable to taxable years
commencing on or after
January 1, 2022
New section
Sec. 5 January 1, 2022 New section
Sec. 6 July 1, 2021, and
applicable to the estates of
decedents dying on or after
January 1, 2021
12-391(i)
Sec. 7 July 1, 2021 New section
Statement of Purpose:
To establish the Connecticut Equitable Investment Fund and council
and dedicate certain revenues to said fund to be used for certain
purposes.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.] Raised Bill No. 1106
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