Lawmakers kill plan to tax home sales

State legislators have effectively killed a measure that would have allowed Connecticut towns to levy a 1 percent real estate conveyance tax on property sales.

The proposed tax, which would have exempted the first $150,000 of a home sale to minimize the impact on first-time buyers, had nevertheless angered real-estate agents and builders concerned about how the levy would affect potential sales in an already down market.

Environmentalists said the bill would have given towns more power on such"green" priorities as purchasing open space, remediating brownfields and preserving historic sites.

John Bolduc, chief executive of the Eastern Connecticut Association of Realtors and an opponent of the proposed tax, said this week that the measure had been referred to the Commerce Committee on a motion by Senate Majority Leader Martin Looney. "The motion actually short-circuited what was expected to be a referral to the Finance Committee and further debate," he said in an email. "Realtors were joined by many members of the public and related professions in urging legislators to oppose this new levy."

The bill had been reported out of the Environment Committee on a 16-14 vote after a similarly numbered Commerce Committee bill was rewritten in its entirety.

A tax on home sellers already is on the books, with conveyance levies of either 0.5 percent or 1 percent on every transaction, depending on the sales price and type of property. In addition, sellers of real estate must pay a municipal tax of a quarter percent to a half percent of the transaction price.

l.howard@theday.com