The Finance, Revenue, and Bonding Committee killed a bill Monday that would have created a new personal income tax credit for premiums paid on long-term care insurance policies.

The bill was supported both by the Commission on Aging and the Insurance Association of Connecticut and would have given individuals a $500 tax credit on their income tax returns. However, the Finance Committee decided not to vote on the bill Monday, effectively killing it for the year.

The bill would have cost the state $71.5 million in lost revenue in the first year and $78.3 million in the second year of the budget, according to the fiscal note.

“If we had $71.5 million we could do away with some of the things we really don’t like in the budget,” Rep. Patricia Widlitz, who co-chairs the Finance Committee, said. “It just has to wait for a better day.”

Supporters of the legislation said the tax credit would encourage more people to purchase long-term care insurance policies.

Deb Migneault of the Commission on Aging said in February that a third of Connecticut’s residents have no plan for their long-term needs. In addition, more than 50 percent of people over the age of 60 “erroneously believe that Medicare will pay for LTSS [long-term services and supports] care.”

There are about 103,000 Connecticut residents who have purchased long-term care policies.

The insurance industry testified that it wouldn’t mind the additional customers, but pointed out that the state would benefit from the tax credit as well because it might not have to spend as much money on the population.

“More times than not, the financial responsibility for long-term care falls to the state,” Susan Giacalone of the Insurance Association of Connecticut testified in February. “Medicaid is one of the biggest tickets on the government’s budget. Last year, the state spent $2.8 billion — or about 10 percent of the state budget — on long-term Medicaid services.”

She said one way to offset that cost in the budget is to encourage people to purchase long-term care insurance with an incentive, like a tax credit, to help reduce the cost.

But as the state faces what could be an up a $3 billion deficit over the next two years, the idea fell flat when it came to financing. It had passed the Insurance and Real Estate Committee by a 19-0 vote.