NTU Urges Opposition to Discriminatory Controlled Substances Tax

Dear Members of the Connecticut General Assembly,
On behalf of the members of the National Taxpayers Union (NTU), I strongly encourage you to oppose Substitute for S.B. 1130. If enacted, the bill would levy a 6.35 percent tax on the gross sales receipts of manufacturers and wholesalers of controlled substances. Ostensibly the revenue generated by such a tax will be used to prevent and treat opioid abuse. No one denies that prescription drug abuse is a serious concern, but punitive legislation such as Substitute for S.B. No. 1130 is the wrong way to address the issue.

Pharmaceutical innovation has led to longer life expectancy and enhanced quality of life for people all over the world. Further, pharmaceutical manufacturers and wholesalers provide employment to countless citizens in Connecticut. Increased taxes on such companies will lead to fewer employed people and less innovation in a critical industry. In addition, federal law preempts states from taxing prescriptions sold through Medicare Part D, which means Substitute for S.B. 1130 would needlessly complicate the tax code and make accounting a headache.

While the intentions of Substitute for S.B. 1130 are noble, its practical effects would have a detrimental impact on the citizens of Connecticut. Accordingly, our members strongly urge all members of the Connecticut General Assembly to oppose Substitute for S.B. 1130.

Clark Packard
Policy and Government Affairs Manager