On October 21, 2019, several tax and fee increases went into effect. These levies, including a 5.35 percent tax increase on digital goods, a one percent increase on prepared meals, and a $65 fee increase for vehicle trade-ins, will ultimately hurt the middle class.
On a more positive note, there are some public acts that I did support. These include measures to combat the opioid crisis, help seniors, and make our children more safe at school.
As always, you may contact me with questions, comment, concerns or ideas relating to this update or any state government matter.
Office: (860) 240-8700 or toll free: (800) 842-1423
Home: (860) 376-9354
Tax and Fee Increases
Digital Goods – The tax on digital goods has increased from 1% to 6.35%. This increase applies to a wide range of online services, including, but not limited to, TV streaming services (e.g. Netflix, Hulu), online music (e.g. Spotify, Apple Music), eBooks, and in-app purchases made on smartphones.
Prepared Foods –The tax on prepared meals has now reached 7.35% on certain prepared foods. Last week, the Department of Revenue Services released a revised bulletin after unexpectedly including thousands of previously untaxed grocery items in their initial interpretation of the law as stated. Importantly, these items, including basic necessities, remain at risk of becoming taxable. The only way to protect consumers from being impacted by this regressive tax is to call a special session and remove the part of the law that taxes groceries. My colleagues and I have petitioned, and await further action from the Speaker of the House.
Motor Vehicle Trade-In Fee –The motor vehicle trade-in fee of $35 has increased to $100. Instead of being rewarded for trading in their old cars for new, more efficient vehicles, car buyers are being punished with a tax increase. This tax hurts not only families looking to upgrade their cars but also businesses that rely on fleets of vehicles to facilitate their everyday operations.
Alcohol – The excise tax on all alcohol sales, except beer, has increased by 10%. This significant increase will be felt by package stores small and large, as well as consumers looking to make alcohol purchases for family gatherings and events.
Public Act 19-38: An Act Increasing the Penalties for the Sale of Fentanyl
Summary: Expressly codifies the classification of fentanyl (a synthetic opioid analgesic) as a narcotic substance. By law, the penalties for certain illegal actions involving narcotics are higher than those for certain other non-narcotic controlled substances.
Public Act 19-43: An Act Concerning the Confidentiality of Law Enforcement Records Concerning Victims of Sexual Assault and Family Violence
Summary: Authorizes the nondisclosure of the names, addresses and identifying information of victims of sexual assault and family violence contained in law enforcement records.
Public Act 19-52: (See Sec. 3) – An Act Concerning School Security
Summary: Requires DESPP to develop criteria to identify qualified school security consultants operating in the state, and limit its existing school security consultants registry to include only these qualified individuals. By law, DESPP must update this registry annually, make it available to the public upon request, and publish it on the department’s website.
Public Act 19-66: An Act Expanding Eligibility for Tax Relief for Certain Elderly Homeowners
Summary: Expands the state’s “Circuit Breaker Program”(Elderly and Disabled Homeowners’ Tax Relief Program) which entitles older adults and individuals with a permanent and total disability to a property tax reduction, to now include owners of real property that is held in trust for the owner. Prior law was silent regarding such trusts.
Public Act 19-169: An Act Extending Good Samaritan Protections for Persons or Entities that Include an Opioid Antagonist Within a Cabinet Containing an Automatic External Defibrillator.
Summary: Extends Good Samaritan protections to persons or entities that include an opioid antagonist within a cabinet containing an automatic external defibrillator.
Public Act 19-191: (See Sec. 1-2, 4-6, 9-11) – An Act Addressing Opioid Use
Summary: Requires pharmacists to offer consultations to all patients when dispensing a prescription. Also requires prescribing practitioners who prescribe an opioid drug with more than a 12-week supply to establish a treatment agreement with the patient or discuss a care plan for chronic opioid drug use, among other changes.