Beginning Jan. 1 2023, Connecticut will impose a new per-mile truck tax on Class 8 through Class 13 motor vehicles.
The Department of Revenue Services recently issued guidance for the highway user fee, enacted by the legislature in 2021, to assist trucking companies with compliance.
According to the nonpartisan Office of Fiscal Analysis, the tax is expected to raise $45 million in fiscal 2023 and $90 million the following year, with revenues directed to the Special Transportation Fund.
Under Connecticut General Statute 12-493a, eligible motor vehicles subject to the tax have (1) a gross weight of 26,000 pounds or more, and (2) a classification between Class 8 and Class 13 under the Federal Highway Administration classification system.
Exempt motor vehicles include those carrying or transporting milk or dairy products to or from a dairy farm that holds a license to ship milk.
The tax is calculated according to the eligible motor vehicle’s weight and the number of miles driven in Connecticut.
Fee Schedule
The fee schedule increases based on the vehicle’s gross weight, ranging from 2.5 cents per mile for vehicles weighing 26,000 to 28,000 pounds to 17.5 cents per mile for vehicles exceeding 80,000 pounds.
The tax is reportable on a month-by-month basis beginning Jan. 1, 2023, with the first HUF tax return due on or before Feb. 28, 2023.
The reporting deadline for each month will be the last day of the following month.
Source: Connecticut Department of Revenue Services.
According to DRS, carriers that operate an eligible motor vehicle will be subject to the HUF and must register with the agency by Jan. 1, 2023.
To register, carriers must complete and submit an online application to DRS.
Once DRS accepts the carrier’s application, the carrier will receive one permit and is required to place a copy of the permit in each eligible vehicle that operates in Connecticut.
No carrier may lawfully operate an eligible motor vehicle in Connecticut on or after Jan. 1, 2023 without that permit.
Filing Requirements
All registered carriers will be required to file a HUF return for all monthly periods, regardless of whether or not it operated vehicles in the state during a particular month.
Filing and paying the tax will be done electronically using the DRS myconneCT website.
DRS provided a template that carriers can use to report their monthly HUF returns and responses to a series of frequently asked questions.
Carriers are required to keep records, receipts, invoices, and other pertinent papers to support the information reported to DRS.
Carriers are also required to keep records, receipts, invoices, and other pertinent papers to support the information reported to DRS each month.
Each carrier is also required to maintain, on a monthly basis, a list of all eligible motor vehicles that operate on a state highway in the state during each month.
These records must be maintained by the carrier for a minimum of four years and are subject to audit by DRS on request.
Penalties
Any person who knowingly violates the provisions of the statute will be subject to a fine of $1,000.
Interest and penalties also apply to any portion of the tax not paid on or before the original due date of the return.
Interest and penalties also apply to any portion of the tax not paid on or before the original due date.
For example, if a business does not pay the tax when due, it will owe interest at the rate of 1% per month or fraction of a month until the tax is paid in full.
The penalty for an incomplete return or late filing is calculated at 10% of the amount of the tax due and unpaid or $550, whichever is greater.
Carriers seeking more information on HUF compliance should contact the DRS hotline (860.297.5677) Monday through Friday, between 8:30 am and 4:30 pm.
The original article can be found at CBIA.