OFFICE OF FISCAL ANALYSIS
Legislative Office Building, Room 5200
Hartford, CT 06106 (860) 240-0200
http://www.cga.ct.gov/ofa
SB-1445
AN ACT AUTHORIZING MUNICIPALITIES TO EXEMPT MOTOR
VEHICLES FROM PROPERTY TAXATION.
Primary Analyst: LG 4/7/25
Contributing Analyst(s):
Reviewer: RW
OFA Fiscal Note
State Impact: None
Municipal Impact:
Municipalities Effect FY 26 $ FY 27 $
All Municipalities Potential Cost See Below See Below
All Municipalities Potential Grand
List
Increase/Decrease
None See Below
Explanation
The bill allows municipalities to (1) adopt an ordinance exempting
motor vehicles from property tax, and (2) increase the assessment ratio
for all other property types to make up any revenue loss.
Exempting motor vehicles from property tax will result in a
significant grand list decrease for any municipality that chooses to adopt
this ordinance beginning in FY 27.
1
It is expected that the town would
offset any grand list decrease by simultaneously increasing the
assessment ratio for all other property types which would result in a
grand list increase.
2
This may also result in a cost to municipalities beginning in FY 26 that
choose to adopt this ordinance associated with compensation for firms
1
In FY 25, the motor vehicle property tax totaled approximately $1.1 billion statewide.
2
Some towns may need to raise their assessment ratio for real and personal property
from .7 to .84 to offset an elimination of the motor vehicle property tax. 2025SB-01445-R000610-FN.DOCX Page 2 of 2
that manage the property assessment software.
This bill has no impact for municipalities that choose not to adopt this
ordinance.
The bill additional requires the Office of Policy and Management
(OPM) to report any information regarding the adoption of this
ordinance. This does not result in a fiscal impact as OPM has the
resources necessary for this report.
The Out Years
The annualized ongoing fiscal impact identified above would
continue into the future subject to inflation.
Assuming a constant mill rate for each municipality, the bill would
also result in a cost to OPM in the out years associated with an increased
cost of the Tiered PILOT grant and a savings in the out years associated
with a decreased cost of the Motor Vehicle Tax grant as both grant
formulas are based on assessed value.