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| 2 | 2 | | |
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| 3 | 3 | | LCO No. 7005 1 of 8 |
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| 4 | 4 | | |
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| 5 | 5 | | General Assembly Raised Bill No. 7273 |
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| 6 | 6 | | January Session, 2025 |
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| 7 | 7 | | LCO No. 7005 |
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| 8 | 8 | | |
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| 9 | 9 | | |
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| 10 | 10 | | Referred to Committee on FINANCE, REVENUE AND |
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| 11 | 11 | | BONDING |
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| 12 | 12 | | |
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| 13 | 13 | | |
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| 14 | 14 | | Introduced by: |
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| 15 | 15 | | (FIN) |
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| 16 | 16 | | |
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| 17 | 17 | | |
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| 18 | 18 | | |
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| 19 | 19 | | |
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| 20 | 20 | | AN ACT IMPOSING A TAX ON CERTAIN SWEETENED BEVERAGES, |
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| 21 | 21 | | SYRUPS AND POWDERS AND DEDICATING THE REVENUE |
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| 22 | 22 | | GENERATED TO A UNIVERSAL FREE SCHOOL MEALS PROGRAM. |
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| 23 | 23 | | Be it enacted by the Senate and House of Representatives in General |
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| 24 | 24 | | Assembly convened: |
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| 25 | 25 | | |
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| 26 | 26 | | Section 1. (NEW) (Effective from passage) (a) As used in this section: 1 |
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| 27 | 27 | | (1) "Distributor" means any person that receives, stores, 2 |
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| 28 | 28 | | manufactures or distributes sweetened beverages, syrups or powders, 3 |
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| 29 | 29 | | for sale to retailers doing business in the state; 4 |
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| 30 | 30 | | (2) "Fruit juice" means the original liquid resulting from the pressing 5 |
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| 31 | 31 | | of fruits or the liquid resulting from the dilution with water of 6 |
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| 32 | 32 | | dehydrated fruit juice; 7 |
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| 33 | 33 | | (3) "Medical beverage" means any (A) medical food, as defined in 21 8 |
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| 34 | 34 | | USC 360ee, as amended from time to time, (B) product in liquid form 9 |
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| 35 | 35 | | that is (i) designed as oral nutrition therapy for individuals who may 10 |
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| 36 | 36 | | have a limited ability to absorb or metabolize dietary nutrients from 11 |
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| 37 | 37 | | traditional food or beverages, or (ii) an oral rehydration electrolyte 12 |
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| 38 | 38 | | Raised Bill No. 7273 |
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| 39 | 39 | | |
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| 40 | 40 | | |
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| 41 | 41 | | |
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| 42 | 42 | | LCO No. 7005 2 of 8 |
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| 43 | 43 | | |
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| 44 | 44 | | solution to prevent or treat dehydration, and (C) product sold in liquid 13 |
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| 45 | 45 | | form that is designed as supplemental, meal replacement or sole-source 14 |
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| 46 | 46 | | nutrition and includes proteins, carbohydrates and multiple vitamins 15 |
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| 47 | 47 | | and minerals; 16 |
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| 48 | 48 | | (4) "Milk-based beverage" means any nonalcoholic beverage that 17 |
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| 49 | 49 | | contains at least fifty per cent dairy ingredients by volume, including 18 |
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| 50 | 50 | | milk, cream, yogurt, kefir or other dairy-derived products, regardless of 19 |
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| 51 | 51 | | butterfat content or added sugar, nonnutritive sweetener or other 20 |
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| 52 | 52 | | flavoring. "Milk-based beverage" includes dairy creamer, milk 21 |
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| 53 | 53 | | concentrate, whether or not reconstituted, and powdered milk, whether 22 |
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| 54 | 54 | | or not reconstituted. "Milk-based beverage" does not include nondairy 23 |
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| 55 | 55 | | milk alternatives or nondairy creamers; 24 |
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| 56 | 56 | | (5) "Nonalcoholic beverage" means any beverage that contains less 25 |
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| 57 | 57 | | than one-half of one per cent alcohol by volume; 26 |
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| 58 | 58 | | (6) "Nonnutritive sweetener" means any substance suitable for 27 |
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| 59 | 59 | | human consumption that humans perceive as sweet and contains fewer 28 |
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| 60 | 60 | | than five calories per serving, such as aspartame, acesulfame potassium, 29 |
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| 61 | 61 | | neotame, saccharin, sucralose and stevia; 30 |
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| 62 | 62 | | (7) "Person" means any individual, partnership, corporation, limited 31 |
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| 63 | 63 | | liability company, association, personal representative, receiver, trustee, 32 |
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| 64 | 64 | | assignee or other legal entity; 33 |
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| 65 | 65 | | (8) "Powder" means a dry mixture of ingredients used to make, mix 34 |
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| 66 | 66 | | or compound sweetened beverages by combining such mixture with 35 |
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| 67 | 67 | | one or more ingredients such as water, ice, syrup, simple syrup, fruits, 36 |
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| 68 | 68 | | vegetables, fruit juice, vegetable juice or carbonation or other gas; 37 |
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| 69 | 69 | | (9) "Retailer" means any person that sells or otherwise dispenses 38 |
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| 70 | 70 | | sweetened beverages to consumers in the state; 39 |
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| 71 | 71 | | (10) "Sugar" means any monosaccharide or disaccharide sweetener 40 |
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| 72 | 72 | | that contains five or more calories per serving, such as cane sugar, beet 41 |
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| 73 | 73 | | Raised Bill No. 7273 |
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| 74 | 74 | | |
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| 75 | 75 | | |
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| 76 | 76 | | |
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| 77 | 77 | | LCO No. 7005 3 of 8 |
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| 78 | 78 | | |
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| 79 | 79 | | sugar, glucose, fructose, lactose, sucrose, high-fructose corn syrup, 42 |
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| 80 | 80 | | honey and fruit juice concentrate; 43 |
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| 81 | 81 | | (11) "Sweetened beverage" means any carbonated or noncarbonated 44 |
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| 82 | 82 | | beverage that is intended for human consumption and contains any 45 |
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| 83 | 83 | | added sugar or nonnutritive sweetener. "Sweetened beverage" does not 46 |
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| 84 | 84 | | include (A) any beverage that is one hundred per cent fruit juice, one 47 |
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| 85 | 85 | | hundred per cent vegetable juice or a combination thereof, (B) any milk-48 |
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| 86 | 86 | | based beverage, (C) water, (D) infant formula, or (E) any medical 49 |
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| 87 | 87 | | beverage; 50 |
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| 88 | 88 | | (12) "Syrup" means a liquid mixture of ingredients used to make, mix 51 |
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| 89 | 89 | | or compound sweetened beverages by combining such mixture with 52 |
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| 90 | 90 | | one or more ingredients such as water, ice, powder, simple syrup, fruits, 53 |
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| 91 | 91 | | vegetables, fruit juice, vegetable juice or carbonation or other gas, and 54 |
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| 92 | 92 | | includes such mixtures sold in a frozen state; 55 |
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| 93 | 93 | | (13) "Vegetable juice" means the original liquid resulting from the 56 |
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| 94 | 94 | | pressing of vegetables or the liquid resulting from the dilution with 57 |
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| 95 | 95 | | water of dehydrated vegetable juice; and 58 |
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| 96 | 96 | | (14) "Water" means carbonated or noncarbonated liquid water that is 59 |
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| 97 | 97 | | unflavored or is flavored without the use of sugars or nonnutritive 60 |
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| 98 | 98 | | sweeteners. 61 |
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| 99 | 99 | | (b) (1) Commencing October 1, 2025, each distributor shall pay a tax 62 |
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| 100 | 100 | | on sweetened beverages, syrups and powders sold to a retailer for sale 63 |
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| 101 | 101 | | in the state of (A) two cents per fluid ounce of sweetened beverages, and 64 |
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| 102 | 102 | | (B) for syrups and powders intended for commercial or institutional use, 65 |
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| 103 | 103 | | two cents per fluid ounce of sweetened beverages that can be produced 66 |
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| 104 | 104 | | from each container of syrup or powder, however packaged, calculated 67 |
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| 105 | 105 | | as the largest volume of sweetened beverage resulting from the use of 68 |
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| 106 | 106 | | such container of syrup or powder in accordance with the 69 |
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| 107 | 107 | | manufacturer's instructions. Any sweetened beverages, syrups and 70 |
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| 108 | 108 | | powders subject to the tax shall be taxed only once under this section. 71 |
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| 109 | 109 | | Raised Bill No. 7273 |
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| 110 | 110 | | |
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| 111 | 111 | | |
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| 112 | 112 | | |
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| 113 | 113 | | LCO No. 7005 4 of 8 |
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| 114 | 114 | | |
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| 115 | 115 | | (2) The tax imposed by this section shall not apply to: 72 |
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| 116 | 116 | | (A) Sales of sweetened beverages, syrups or powders by a distributor 73 |
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| 117 | 117 | | to (i) the state or a political subdivision thereof, (ii) the federal 74 |
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| 118 | 118 | | government, (iii) a tribal government, (iv) a retailer expressly for resale 75 |
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| 119 | 119 | | or consumption outside the state, (v) another distributor, provided the 76 |
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| 120 | 120 | | sales invoice clearly indicates the sale is to another distributor, or (vi) a 77 |
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| 121 | 121 | | person that is both a distributor and a retailer, provided such person 78 |
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| 122 | 122 | | shall pay such tax upon the resale of such product to a retailer or a 79 |
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| 123 | 123 | | consumer; or 80 |
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| 124 | 124 | | (B) Sales of syrups and powders packaged to be used by a consumer 81 |
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| 125 | 125 | | for personal use. 82 |
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| 126 | 126 | | (c) On or before the last day of the month following each monthly 83 |
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| 127 | 127 | | period, each distributor shall file a return with the Department of 84 |
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| 128 | 128 | | Revenue Services. Such return shall be in such form and contain such 85 |
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| 129 | 129 | | information as the Commissioner of Revenue Services prescribes as 86 |
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| 130 | 130 | | necessary for the administration of the tax under this section and shall 87 |
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| 131 | 131 | | be accompanied by a payment of the amount of tax shown to be due 88 |
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| 132 | 132 | | thereon. Each distributor shall file such return electronically with the 89 |
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| 133 | 133 | | department and make such payment by electronic funds transfer in the 90 |
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| 134 | 134 | | manner provided by chapter 228g of the general statutes. 91 |
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| 135 | 135 | | (d) The commissioner shall deposit the amounts received by the state 92 |
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| 136 | 136 | | from the tax imposed by subsection (b) of this section in the universal 93 |
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| 137 | 137 | | free school meals account established under section 2 of this act. 94 |
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| 138 | 138 | | (e) The provisions of sections 12-547 to 12-554, inclusive, of the 95 |
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| 139 | 139 | | general statutes and section 12-555a of the general statutes shall apply 96 |
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| 140 | 140 | | to the provisions of this section in the same manner and with the same 97 |
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| 141 | 141 | | force and effect as if the language of said sections had been incorporated 98 |
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| 142 | 142 | | in full into this section and had expressly referred to the tax under this 99 |
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| 143 | 143 | | section, except to the extent that any such provision is inconsistent with 100 |
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| 144 | 144 | | a provision of this section. 101 |
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| 145 | 145 | | Raised Bill No. 7273 |
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| 146 | 146 | | |
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| 147 | 147 | | |
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| 148 | 148 | | |
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| 149 | 149 | | LCO No. 7005 5 of 8 |
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| 150 | 150 | | |
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| 151 | 151 | | (f) The Commissioner of Revenue Services may adopt regulations, in 102 |
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| 152 | 152 | | accordance with the provisions of chapter 54 of the general statutes, to 103 |
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| 153 | 153 | | implement the provisions of this section and may make rulings, not 104 |
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| 154 | 154 | | inconsistent with law, to carry into effect the provisions of this section, 105 |
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| 155 | 155 | | which regulations or rulings, when reasonably designed to carry out the 106 |
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| 156 | 156 | | intent and purposes of this section, shall be prima facie evidence of its 107 |
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| 157 | 157 | | proper interpretation. 108 |
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| 158 | 158 | | (g) At the end of each fiscal year commencing with the fiscal year 109 |
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| 159 | 159 | | ending on June 30, 2026, the Comptroller is authorized to record as 110 |
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| 160 | 160 | | revenue for such fiscal year the amount of tax imposed under the 111 |
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| 161 | 161 | | provisions of this section on all sweetened beverages, syrups and 112 |
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| 162 | 162 | | powders sold prior to the end of such fiscal year and which tax is 113 |
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| 163 | 163 | | received by the Commissioner of Revenue Services not later than five 114 |
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| 164 | 164 | | business days after the last day of July immediately following the end 115 |
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| 165 | 165 | | of such fiscal year. 116 |
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| 166 | 166 | | (h) (1) The Commissioner of Revenue Services shall enter into a 117 |
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| 167 | 167 | | contract with academic researchers who have a proven track record of 118 |
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| 168 | 168 | | rigorous policy evaluation for impacts on behavior, health and 119 |
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| 169 | 169 | | economic outcomes, to evaluate the effects of the tax imposed by 120 |
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| 170 | 170 | | subsection (b) of this section, for at least the first five years after the 121 |
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| 171 | 171 | | reimbursement grants under section 2 of this act are first disbursed. 122 |
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| 172 | 172 | | Such evaluation shall assess, but need not be limited to, the following: 123 |
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| 173 | 173 | | (A) The process of implementing the tax, including the perceptions 124 |
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| 174 | 174 | | of residents and specifically low-income households as determined by 125 |
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| 175 | 175 | | the researchers, distributors, retailers and the Department of Revenue 126 |
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| 176 | 176 | | Services and other state officials as determined by the researchers; 127 |
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| 177 | 177 | | (B) The impact of the tax on economic outcomes, including household 128 |
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| 178 | 178 | | food expenditures, beverage prices and sales, jobs in the state and 129 |
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| 179 | 179 | | retailer revenues; 130 |
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| 180 | 180 | | (C) The impact of the tax on health outcomes, including dietary 131 |
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| 181 | 181 | | purchases and consumption; and 132 |
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| 182 | 182 | | Raised Bill No. 7273 |
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| 183 | 183 | | |
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| 184 | 184 | | |
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| 185 | 185 | | |
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| 186 | 186 | | LCO No. 7005 6 of 8 |
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| 187 | 187 | | |
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| 188 | 188 | | (D) How the tax revenue is being used and the impact of such 133 |
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| 189 | 189 | | funding. 134 |
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| 190 | 190 | | (2) The researchers shall submit such evaluation to the commissioner 135 |
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| 191 | 191 | | for the first, third and fifth year after the reimbursement grants under 136 |
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| 192 | 192 | | section 2 of this act are first disbursed. The commissioner shall submit 137 |
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| 193 | 193 | | such evaluation to the joint standing committees of the General 138 |
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| 194 | 194 | | Assembly having cognizance of matters relating to finance, revenue and 139 |
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| 195 | 195 | | bonding, education and public health and shall post such evaluation on 140 |
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| 196 | 196 | | the Department of Revenue Services' Internet web site. 141 |
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| 197 | 197 | | Sec. 2. (NEW) (Effective from passage) (a) (1) The Commissioner of 142 |
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| 198 | 198 | | Education shall establish, for school years commencing on and after July 143 |
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| 199 | 199 | | 1, 2026, a universal free school meals program to provide 144 |
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| 200 | 200 | | reimbursement grants from the universal free school meals account 145 |
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| 201 | 201 | | established under this section to local and regional boards of education, 146 |
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| 202 | 202 | | to assist public schools to provide free breakfasts and lunches to all 147 |
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| 203 | 203 | | public school students. Funds from the account shall be allocated on a 148 |
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| 204 | 204 | | per-meal reimbursement rate determined by the commissioner, 149 |
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| 205 | 205 | | adjusted annually to reflect changes in food service costs. 150 |
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| 206 | 206 | | (2) (A) Not later than February 1, 2026, the commissioner shall 151 |
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| 207 | 207 | | establish guidelines for the program, the form and manner by which 152 |
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| 208 | 208 | | local and regional boards of education may request reimbursement 153 |
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| 209 | 209 | | under the program, the information required to substantiate such 154 |
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| 210 | 210 | | requests and any other provisions the commissioner deems necessary to 155 |
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| 211 | 211 | | implement the program. Not later than March 1, 2026, the commissioner 156 |
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| 212 | 212 | | shall post information concerning the program on the Department of 157 |
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| 213 | 213 | | Education's Internet web site and notify all local and regional boards of 158 |
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| 214 | 214 | | education of such posting. 159 |
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| 215 | 215 | | (B) The department shall (i) provide training and offer technical 160 |
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| 216 | 216 | | assistance to local and regional boards of education to effectively 161 |
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| 217 | 217 | | implement the program, and (ii) conduct public awareness campaigns 162 |
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| 218 | 218 | | to inform public school students, families and staff about the program. 163 |
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| 219 | 219 | | Raised Bill No. 7273 |
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| 220 | 220 | | |
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| 221 | 221 | | |
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| 222 | 222 | | |
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| 223 | 223 | | LCO No. 7005 7 of 8 |
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| 224 | 224 | | |
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| 225 | 225 | | (3) Local and regional boards of education may not request 164 |
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| 226 | 226 | | reimbursement for school breakfasts and lunches for which funding is 165 |
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| 227 | 227 | | or will be provided through the National School Lunch Program, the 166 |
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| 228 | 228 | | School Breakfast Program or any other similar program. 167 |
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| 229 | 229 | | (4) If the total amount of the reimbursements requested for any school 168 |
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| 230 | 230 | | year exceeds the amount available for disbursement through the 169 |
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| 231 | 231 | | universal free school meals program, the commissioner shall reduce the 170 |
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| 232 | 232 | | amount of the reimbursement grant payable to each eligible local and 171 |
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| 233 | 233 | | regional board of education proportionately. 172 |
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| 234 | 234 | | (b) There is established an account to be known as the "universal free 173 |
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| 235 | 235 | | school meals account", which shall be a separate, nonlapsing account. 174 |
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| 236 | 236 | | The account shall contain any moneys required by law to be deposited 175 |
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| 237 | 237 | | in the account. Moneys in the account shall be expended by the 176 |
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| 238 | 238 | | Department of Education for the sole purpose of providing 177 |
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| 239 | 239 | | reimbursement grants to local and regional boards of education 178 |
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| 240 | 240 | | pursuant to subsection (a) of this section. 179 |
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| 241 | 241 | | (c) The commissioner may adopt regulations, in accordance with the 180 |
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| 242 | 242 | | provisions of chapter 54 of the general statutes, to implement the 181 |
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| 243 | 243 | | provisions of this section. 182 |
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| 244 | 244 | | (d) Not later than November 1, 2027, and annually thereafter, the 183 |
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| 245 | 245 | | Commissioners of Education and Revenue Services shall jointly submit 184 |
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| 246 | 246 | | a report, in accordance with the provisions of section 11-4a of the general 185 |
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| 247 | 247 | | statutes, to the joint standing committees of the General Assembly 186 |
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| 248 | 248 | | having cognizance of matters relating to education, finance, revenue 187 |
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| 249 | 249 | | and bonding and public health. Such report shall include information 188 |
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| 250 | 250 | | for the preceding fiscal year concerning (1) the amounts received by the 189 |
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| 251 | 251 | | state from the tax imposed by section 1 of this act, (2) the total amount 190 |
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| 252 | 252 | | of the reimbursement grants disbursed under this section, (3) the 191 |
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| 253 | 253 | | specific boards of education to which such grants were disbursed and 192 |
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| 254 | 254 | | the total amount each such board was provided, (4) for each such board, 193 |
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| 255 | 255 | | the number of meals reimbursed through each grant, and (5) any other 194 |
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| 256 | 256 | | Raised Bill No. 7273 |
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| 257 | 257 | | |
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| 258 | 258 | | |
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| 259 | 259 | | |
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| 260 | 260 | | LCO No. 7005 8 of 8 |
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| 261 | 261 | | |
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| 262 | 262 | | information the commissioners deem relevant to the evaluation of the 195 |
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| 263 | 263 | | effectiveness of such tax in providing free breakfasts and lunches to 196 |
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| 264 | 264 | | public school students. Said commissioners shall post such report on 197 |
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| 265 | 265 | | each department's Internet web site. 198 |
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| 266 | 266 | | This act shall take effect as follows and shall amend the following |
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| 267 | 267 | | sections: |
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| 268 | 268 | | |
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| 269 | 269 | | Section 1 from passage New section |
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| 270 | 270 | | Sec. 2 from passage New section |
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| 271 | 271 | | |
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| 272 | 272 | | Statement of Purpose: |
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| 273 | 273 | | To impose a tax on certain sweetened beverages, syrups and powders |
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| 274 | 274 | | and dedicate the revenue generated to a universal free school meals |
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| 275 | 275 | | program to reimburse local and regional boards of education for the |
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| 276 | 276 | | provision of free school breakfasts and lunches to all public school |
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| 277 | 277 | | students. |
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| 278 | 278 | | |
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| 279 | 279 | | [Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except |
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| 280 | 280 | | that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not |
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| 281 | 281 | | underlined.] |
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| 282 | 282 | | |
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