Conn. Gen. Stat. § 12-408

Current with legislation from the 2024 Regular and Special Sessions.

Section 12-408 - The sales tax

(1)Imposition and rate of sales tax.

(A) For the privilege of making any sales, as defined in subdivision (2) of subsection (a) of section 12-407, at retail, in this state for a consideration, a tax is hereby imposed on all retailers at the rate of six and thirty-five-hundredths per cent of the gross receipts of any retailer from the sale of all tangible personal property sold at retail or from the rendering of any services constituting a sale in accordance with subdivision (2) of subsection (a) of section 12-407, except, in lieu of said rate, the rates provided in subparagraphs (B) to (I), inclusive, of this subdivision;

(B)

(i) At a rate of fifteen per cent with respect to each transfer of occupancy, from the total amount of rent received by a hotel or lodging house for the first period not exceeding thirty consecutive calendar days;

(ii) At a rate of eleven per cent with respect to each transfer of occupancy, from the total amount of rent received by a bed and breakfast establishment for the first period not exceeding thirty consecutive calendar days;

(C) With respect to the sale of a motor vehicle to any individual who is a member of the armed forces of the United States and is on full-time active duty in Connecticut and who is considered, under 50 App USC 574, a resident of another state, or to any such individual and the spouse thereof, at a rate of four and one-half per cent of the gross receipts of any retailer from such sales, provided such retailer requires and maintains a declaration by such individual, prescribed as to form by the commissioner and bearing notice to the effect that false statements made in such declaration are punishable, or other evidence, satisfactory to the commissioner, concerning the purchaser's state of residence under 50 App USC 574;

(D)

(i) With respect to the sales of computer and data processing services occurring on or after July 1, 2001, at the rate of one per cent, and

(ii) with respect to sales of Internet access services, on and after July 1, 2001, such services shall be exempt from such tax;

(E)

(i) With respect to the sales of labor that is otherwise taxable under subparagraph (C) or (G) of subdivision (2) of subsection (a) of section 12-407 on existing vessels and repair or maintenance services on vessels occurring on and after July 1, 1999, such services shall be exempt from such tax;

(ii) With respect to the sale of a vessel, a motor for a vessel or a trailer used for transporting a vessel, at the rate of two and ninety-nine-hundredths per cent, except that the sale of a vessel shall be exempt from such tax if such vessel is docked in this state for sixty or fewer days in a calendar year;

(iii) With respect to the sale of dyed diesel fuel, as defined in subsection (d) of section 12-487, sold by a marine fuel dock exclusively for marine purposes, at the rate of two and ninety-nine-hundredths per cent;

(F) With respect to patient care services for which payment is received by the hospital on or after July 1, 1999, and prior to July 1, 2001, at the rate of five and three-fourths per cent and on and after July 1, 2001, such services shall be exempt from such tax;

(G) With respect to the rental or leasing of a passenger motor vehicle for a period of thirty consecutive calendar days or less, at a rate of nine and thirty-five-hundredths per cent;

(H) With respect to the sale of (i) a motor vehicle for a sales price exceeding fifty thousand dollars, at a rate of seven and three-fourths per cent on the entire sales price, (ii) jewelry, whether real or imitation, for a sales price exceeding five thousand dollars, at a rate of seven and three-fourths per cent on the entire sales price, and (iii) an article of clothing or footwear intended to be worn on or about the human body, a handbag, luggage, umbrella, wallet or watch for a sales price exceeding one thousand dollars, at a rate of seven and three-fourths per cent on the entire sales price. For purposes of this subparagraph, "motor vehicle" has the meaning provided in section 14-1, but does not include a motor vehicle subject to the provisions of subparagraph (C) of this subdivision, a motor vehicle having a gross vehicle weight rating over twelve thousand five hundred pounds, or a motor vehicle having a gross vehicle weight rating of twelve thousand five hundred pounds or less that is not used for private passenger purposes, but is designed or used to transport merchandise, freight or persons in connection with any business enterprise and issued a commercial registration or more specific type of registration by the Department of Motor Vehicles;

(I) With respect to the sale of meals, as defined in subdivision (13) of section 12-412, sold by an eating establishment, caterer or grocery store; and spirituous, malt or vinous liquors, soft drinks, sodas or beverages such as are ordinarily dispensed at bars and soda fountains, or in connection therewith; in addition to the tax imposed under subparagraph (A) of this subdivision, at the rate of one per cent;

(J) The rate of tax imposed by this chapter shall be applicable to all retail sales upon the effective date of such rate, except that a new rate that represents an increase in the rate applicable to the sale shall not apply to any sales transaction wherein a binding sales contract without an escalator clause has been entered into prior to the effective date of the new rate and delivery is made within ninety days after the effective date of the new rate. For the purposes of payment of the tax imposed under this section, any retailer of services taxable under subdivision (37) of subsection (a) of section 12-407, who computes taxable income, for purposes of taxation under the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, on an accounting basis that recognizes only cash or other valuable consideration actually received as income and who is liable for such tax only due to the rendering of such services may make payments related to such tax for the period during which such income is received, without penalty or interest, without regard to when such service is rendered;

(K)

(i) For calendar quarters ending on or after September 30, 2019, the commissioner shall deposit into the regional planning incentive account, established pursuant to section 4-66k, six and seven-tenths per cent of the amounts received by the state from the tax imposed under subparagraph (B) of this subdivision and ten and seven-tenths per cent of the amounts received by the state from the tax imposed under subparagraph (G) of this subdivision;

(ii) For calendar quarters ending on or after September 30, 2018, the commissioner shall deposit into the Tourism Fund established under section 10-395b ten per cent of the amounts received by the state from the tax imposed under subparagraph (B) of this subdivision;

(L)

(i) For calendar months commencing on or after July 1, 2021, but prior to July 1, 2023, the commissioner shall deposit into the municipal revenue sharing account established pursuant to section 4-66l seven and nine-tenths per cent of the amounts received by the state from the tax imposed under subparagraph (A) of this subdivision, including such amounts received on or after July 1, 2023, attributable to the fiscal year ending June 30, 2023; and

(ii) For calendar months commencing on or after July 1, 2023, the commissioner shall deposit into the Municipal Revenue Sharing Fund established pursuant to section 4-66p seven and nine-tenths per cent of the amounts received by the state from the tax imposed under subparagraph (A) of this subdivision; and

(M)

(i) For calendar months commencing on or after July 1, 2017, the commissioner shall deposit into the Special Transportation Fund established under section 13b-68 seven and nine-tenths per cent of the amounts received by the state from the tax imposed under subparagraph (A) of this subdivision;

(ii) For calendar months commencing on or after July 1, 2018, but prior to July 1, 2019, the commissioner shall deposit into the Special Transportation Fund established under section 13b-68 eight per cent of the amounts received by the state from the tax imposed under subparagraphs (A) and (H) of this subdivision on the sale of a motor vehicle;

(iii) For calendar months commencing on or after July 1, 2019, but prior to July 1, 2020, the commissioner shall deposit into the Special Transportation Fund established under section 13b-68 seventeen per cent of the amounts received by the state from the tax imposed under subparagraphs (A) and (H) of this subdivision on the sale of a motor vehicle;

(iv) For calendar months commencing on or after July 1, 2020, but prior to July 1, 2021, the commissioner shall deposit into the Special Transportation Fund established under section 13b-68 twenty-five per cent of the amounts received by the state from the tax imposed under subparagraphs (A) and (H) of this subdivision on the sale of a motor vehicle;

(v) For calendar months commencing on or after July 1, 2021, but prior to July 1, 2022, the commissioner shall deposit into the Special Transportation Fund established under section 13b-68 seventy-five per cent of the amounts received by the state from the tax imposed under subparagraphs (A) and (H) of this subdivision on the sale of a motor vehicle; and

(vi) For calendar months commencing on or after July 1, 2022, the commissioner shall deposit into the Special Transportation Fund established under section 13b-68 one hundred per cent of the amounts received by the state from the tax imposed under subparagraphs (A) and (H) of this subdivision on the sale of a motor vehicle.

(2)Retailer collects tax from consumer. Credit allowed for tax remitted to state on worthless account receivable.

(A) Reimbursement for the tax hereby imposed shall be collected by the retailer from the consumer and such tax reimbursement, termed "tax" in this and the following subsections, shall be paid by the consumer to the retailer and each retailer shall collect from the consumer the full amount of the tax imposed by this chapter or an amount equal as nearly as possible or practicable to the average equivalent thereof. Such tax shall be a debt from the consumer to the retailer, when so added to the original sales price, and shall be recoverable at law in the same manner as other debts except as provided in section 12-432a. The amount of tax reimbursement, when so collected, shall be deemed to be a special fund in trust for the state of Connecticut.

(B) Whenever such tax, payable by the consumer (i) with respect to a charge account or credit sale, is remitted by the retailer to the commissioner and such sale as an account receivable is determined to be worthless and is actually written off as uncollectible for federal income tax purposes, or (ii) to a retailer who computes taxable income, for purposes of taxation under the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, on the cash basis method of accounting with respect to a sale, is remitted by the retailer to the commissioner and such sale as an account receivable is determined to be worthless, the amount of such tax remitted may be credited against the tax due on the sales tax return filed by the retailer for the monthly or quarterly period, whichever is applicable, next following the period in which such amount is actually so written off, but in no event shall such credit be allowed later than three years following the date such tax is remitted, unless the credit relates to a period for which a waiver is given pursuant to subsection (g) of section 12-415. The commissioner shall, by regulations adopted in accordance with the provisions of chapter 54, provide standards for proving any such claim for credit. If any payment is made by a consumer with respect to an account, such payment shall be applied first toward the sales tax, and if any account with respect to which such credit is allowed is thereafter collected by the retailer in whole or in part, the amount so collected, up to the amount of the sales tax for which the credit was claimed, shall be included in the sales tax return covering the period in which such collection occurs. The tax applicable in any such case shall be determined in accordance with the rate of sales tax in effect at the time of the original sale.

(C)

(i) Any person required to collect tax in accordance with this subsection who demonstrates to the satisfaction of the Commissioner of Revenue Services by July first of any year that, in any two quarterly periods as described in section 12-414, within the most recent four consecutive quarterly periods, such person was a materialman as such term is used in chapter 847, who has at least fifty per cent of such person's sales of building materials to contractors, subcontractors or repairmen for the improvement of real property, and is authorized by said chapter to file a mechanic's lien upon such real property and improvement shall, with respect to such sales made through the quarterly period ending the succeeding June thirtieth, collect tax due on such sales, and on sales to such contractors, subcontractors or repairmen of services described in subdivision (2) of subsection (a) of section 12-407 with respect to such building materials, for such purpose and made during such July first through June thirtieth period, at the time and to the extent that such person receives the receipts from, or consideration for, such sales from such contractors, subcontractors or repairmen, provided if such person receives a portion of such receipts or consideration, such person shall collect the tax due on such portion at the time the portion is received. The taxes imposed by this chapter on such receipts and consideration shall be deemed imposed, solely for purposes of determining when such person is required to collect and pay over such taxes to the commissioner under section 12-414, when such person has received payment of such receipts or consideration in money, or money's worth, from such contractor, subcontractor or repairman. A contractor, subcontractor or repairman who purchases building materials or services from such person pursuant to this subparagraph shall, at the time such contractor, subcontractor or repairman pays any portion of the purchase price, pay to the person the tax due on the portion of the purchase price so paid.

(ii) In the event that a materialman described in this subparagraph factors any portion of such materialman's receivables, such materialman shall be deemed to have received payment of such receipts or consideration in money or money's worth, from the contractor, subcontractor or repairman and shall be required to pay over tax on such sale with the next return due, with a credit against such tax for any tax already paid over with respect to such sale. Any such amount of tax paid over shall be on account of the tax required to be collected on the sale to which it relates and such materialman may take a credit against any tax paid by such contractor, subcontractor or repairman in the future on such sale, to ensure that tax paid over with respect to such sale does not exceed the amount of tax imposed on such sale as if the entire purchase price had been paid at the time of sale.

(iii) A materialman described in this subparagraph who has not collected the tax due on the full purchase price for a sale described in this subparagraph from a contractor, subcontractor or repairman within one year from the date of such sale, shall pay over to the commissioner the tax due on any balance of such full purchase price with such materialman's return for the period which includes the date which is one year after the date of such sale.

(iv) The commissioner may assess additional tax due with respect to a sale described in this subparagraph not later than three years from the date the tax is required to be paid over to the commissioner pursuant to this subparagraph, and in the case of a wilfully false or fraudulent return with intent to evade the tax, or where no return has been filed such taxpayer shall be subject to the provisions of section 12-428.

(D) In the case of a sale by a producer or wholesaler of newspapers to a vendor who is not otherwise required to obtain a permit under this chapter, such producer or wholesaler shall collect the sales tax on such newspapers at the point of transfer to such vendor. Such tax shall be based on the stated retail price of such newspapers. Such vendor may add an amount to the price of the newspapers equal to the amount paid as sales tax to the producer or wholesaler and such vendor shall not be required to remit such amount to the state.

(3)Bracket system for adding and collecting tax. For the purpose of adding and collecting the tax imposed by this chapter, or an amount equal as nearly as possible or practicable to the average equivalent thereof, by the retailer from the consumer the following bracket system shall be in force and effect as follows:

Amount of Sale	Amount of Tax
$0.00 to $0.07 inclusive	No Tax
.08 to .23 inclusive	1 cent
.24 to .39 inclusive	2 cents
.40 to .55 inclusive	3 cents
.56 to .70 inclusive	4 cents
.71 to .86 inclusive	5 cents
.87 to 1.02 inclusive	6 cents
1.03 to 1.18 inclusive	7 cents

On all sales above $1.18, the tax shall be computed at the rate of six and thirty-five-hundredths per cent.

(4)Unlawful advertising. No retailer shall advertise or hold out or state to the public or to any consumer, directly or indirectly, that the tax or any part thereof will be assumed or absorbed by the retailer or that it will not be added to the sales price of the property sold or that, if added, it or any part thereof will be refunded. Under the provisions of this section, however, a retailer may advertise the sale of tangible personal property by any of the following methods: By stating the sales price alone without reference to the tax; by stating separately the sales price and the amount of tax to be collected thereon; by stating the sales price "plus tax" or "exclusive of tax" or by stating a sales price which includes the tax, together with the words "tax included" or "tax incl."; provided the retailer in the case of all such sales shall maintain his records to show separately the actual price of such sales and the amount of the tax paid thereon; and provided such retailer, if requested, shall furnish the consumer with a sales slip or other like evidence of the sale, showing the tax separately computed thereon. Any person violating any provision of this subsection shall be fined five hundred dollars for each offense.

(5)Notices, signs or advertisements subject to approval. No retailer shall exhibit or display on his premises any notice, sign or other advertising matter tending to mislead the public in connection with the imposition or collection of the tax. The Commissioner of Revenue Services may approve a form of notice for the purpose of explaining the operation of the tax.

(6)Regulations related to sales of motor vehicles to certain members of the armed forces. The Commissioner of Revenue Services shall adopt regulations, in accordance with chapter 54, establishing a procedure for determination of qualifications with respect to the reduced rate of sales tax in the case of certain sales of motor vehicles to members of the armed forces as provided in subsection (1) of this section.

(7)Computation of tax for purposes of toll telephone service in coin-operated telephones. For purposes of the tax imposed by this chapter, with respect to toll telephone service paid by inserting coins in coin-operated telephones, the tax shall be computed to the nearest multiple of five cents, except if the tax is midway between multiples of five cents, the next higher multiple shall apply.

Conn. Gen. Stat. § 12-408

(1949 Rev., S. 2092; 1951, 1953, June, 1955, S. 1163d, 1164d; November, 1955, S. N144, N145; 1957, P.A. 553, S. 1, 2; 1959, P.A. 578, S. 10; 1961, P.A. 574, S. 1, 2; February, 1965, P.A. 105, S. 1; 381, S. 2; 1967, P.A. 619, S. 1; June, 1969, P.A. 1, S. 18, 19; June, 1971, P.A. 5, S. 105, 106; 8, S. 3, 4; 1972, P.A. 285, S. 1, 2; P.A. 73-288, S. 1, 2; 73-616, S. 49, 67; P.A. 74-73, S. 1, 2, 5; P.A. 75-2, S. 1, 2, 5; 75-213, S. 23, 53; P.A. 76-114, S. 1, 21; P.A. 77-370, S. 1, 13; 77-604, S. 76, 84; 77-614, S. 139, 610; P.A. 78-71, S. 1, 5; P.A. 80-71, S. 17, 18, 30; June Sp. Sess. P.A. 83-1, S. 8, 15; P.A. 84-362, S. 1, 2; 84-545, S. 1-3; P.A. 85-547, S. 1, 2; P.A. 86-397, S. 3, 10; P.A. 87-314, S. 1, 2; P.A. 88-314, S. 22, 54; P.A. 89-251, S. 7, 197, 198, 203; P.A. 90-336, S. 1, 3; June Sp. Sess. P.A. 91-3 , S. 111 , 168 ; June Sp. Sess. P.A. 91-14 , S. 23 , 30 ; P.A. 92-184 , S. 14 , 19 ; May Sp. Sess. P.A. 92-5 , S. 26 , 37 ; May Sp. Sess. P.A. 92-17 , S. 25 , 26 , 59 ; P.A. 93-44 , S. 3 , 22 , 24 ; 93-74 , S. 22 , 67 ; 93-332 , S. 4 , 42 ; P.A. 94-9 , S. 16 , 41 ; May Sp. Sess. P.A. 94-4 , S. 17 , 85 ; P.A. 95-160 , S. 39 , 64 , 69 ; P.A. 96-139 , S. 12 , 13 ; 96-232 , S. 1 , 3 ; P.A. 97-243 , S. 17 , 67 ; P.A. 98-110 , S. 6 , 27 ; 98-244 , S. 17 , 35 ; 98-262 , S. 5 , 22 ; P.A. 99-48 , S. 8 , 10 ; 99-173 , S. 13 , 14 , 65 ; P.A. 00-170 , S. 7 , 42 ; 00-174 , S. 4 , 83 ; 00-230 , S. 5 ; June Sp. Sess. P.A. 01-6 , S. 3 , 85 ; P.A. 02-3 , S. 2 ; 02-103 , S. 4 ; May 9 Sp. Sess. P.A. 02-1 , S. 69 ; P.A. 03-2 , S. 25 ; 03-4 , S. 1 ; June 30 Sp. Sess. P.A. 03-1, S. 95; June Sp. Sess. P.A. 09-3 , S. 108 , 109 ; P.A. 11-6 , S. 93 , 94 ; 11-61 , S. 42 , 43 , 183 ; P.A. 13-184 , S. 77 ; 13-247 , S. 318 ; P.A. 14-122 , S. 96 ; P.A. 15-244 , S. 72 , 74 ; June Sp. Sess. P.A. 15-5 , S. 132 ; Dec. Sp. Sess. P.A. 15-1 , S. 32 ; May Sp. Sess. P.A. 16-2 , S. 40 ; P.A. 17-147 , S. 12 ; June Sp. Sess. P.A. 17-2 , S. 637 ; P.A. 18-26 , S. 13 , 14 ; 18-81 , S. 62 .)

Amended by P.A. 23-0204, S. 73 of the Connecticut Acts of the 2023 Regular Session, eff. 7/1/2023.

Amended by P.A. 19-0117, S. 323 of the Connecticut Acts of the 2019 Regular Session, eff. 10/1/2019.

Amended by P.A. 19-0117, S. 317 of the Connecticut Acts of the 2019 Regular Session, eff. 7/1/2019.

Amended by P.A. 19-0186, S. 5 of the Connecticut Acts of the 2019 Regular Session, eff. 7/8/2019.

Amended by P.A. 18-0026, S. 14 of the Connecticut Acts of the 2018 Regular Session, eff. 10/1/2018.

Amended by P.A. 18-0026, S. 13 of the Connecticut Acts of the 2018 Regular Session, eff. 10/1/2018.

Amended by P.A. 17-0002, S. 637 of the Connecticut Acts of the 2017 Special Session, eff. 10/31/2017.

Amended by P.A. 17-0147, S. 12 of the Connecticut Acts of the 2017 Regular Session, eff. 10/1/2017.

Amended by P.A. 16-0002, S. 40 of the Connecticut Acts of the 2016 Special Session, eff. 6/2/2016.

Amended by P.A. 15-0001, S. 32 of the Connecticut Acts of the Second 2015 Special Session, eff. 12/29/2015.

Amended by P.A. 15-0005, S. 132 of the Connecticut Acts of the 2015 First Special Session, eff. 7/6/2015op. 10/1/2015.

Amended by P.A. 15-0244, S. 74 of the Connecticut Acts of the 2015 Regular Session, eff. 6/30/2015, op. 10/1/2015.

Amended by P.A. 15-0244, S. 72 of the Connecticut Acts of the 2015 Regular Session, eff. 7/1/2015.

Amended by P.A. 14-0122, S. 96 of the Connecticut Acts of the 2014 Regular Session, eff. 10/1/2014.

Cited. 134 C. 297 ; 144 C. 311 ; 158 C. 238 . It is generally held that a general contractor who purchases material from a retailer for use in the construction of a building for his customer is the "consumer" of those materials within the meaning of that term as it appears in the statutes. 168 Conn. 597 . Cited. 183 Conn. 194 . Preprints of advertising matter are not printed for resale and are therefore subject to sales tax on the transaction between the printer and the advertiser. Id., 566. Cited. 187 Conn. 581 ; 210 C. 567 ; 216 Conn. 17 ; 222 Conn. 49 ; 231 Conn. 315 ; 235 Conn. 393 ; 238 Conn. 571 ; Id., 761. Since statute does not expressly permit assignment of the right to the tax credit, no such assignment is permitted. 274 C. 196 . Cited. 18 Conn.App. 434 . Services of self-employed welder exempt from sales tax. 30 Conn.Supp. 309 . Sales tax to be collected, if at all, at time of original transfer. 37 CS 642. Cited. 41 Conn.Supp. 175 ; 44 CS 1. Cited 5 Conn. Cir. Ct. 403. Subsec. (1): Tax imposed on rental payments from July 1, 1975, does not result in double taxation since sales tax paid on property purchased before that date was imposed on lessors and levied on purchase, while tax imposed after that date was imposed on lessees and is levied on rent. 174 Conn. 51 . Cited. 198 Conn. 413 ; Id., 624; 204 C. 122 ; 221 Conn. 751 . Refuse removal fees charged by plaintiff to commercial, industrial and income-producing end users on a revenue neutral basis are not subject to sales tax because the requisite consideration did not exist to sustain the imposition of sales tax since plaintiff functioned as a mere conduit between end users. 317 C. 319 . Cited. 2 Conn.App. 303 . Receipts of catering business subject to sales tax; where owner innocently failed to file return for 21 years, held recovery of sales taxes limited to 3 years and penalty and interest. 31 Conn.Supp. 373 . Cited. 39 Conn.Supp. 234 ; 44 Conn.Supp. 133 . Subsec. (2): Tax is actually imposed upon purchaser and, where government is purchaser, no tax can be levied. 145 Conn. 161 . Cited. 205 C. 51 . Computer and data processing services including the development, creation or production of software are subject to taxation pursuant to Sec. 12-407 . 255 Conn. 498 . Subdiv. (B): Tax credit is available only to retailer in initial sales transaction responsible for remitting tax to Commissioner of Revenue Services. 274 Conn. 196 . Unless otherwise indicated in an agreement, applicable sales and use taxes are assumed to be included in the contract price; accordingly, plaintiff could not prevail on claim that it was authorized to add sales tax to rate set in contract. 96 CA 806 . Failure of a retailer to add the amount of the tax to the sale price at the time of sale precludes the tax from becoming a debt of the consumer recoverable by the retailer. 36 CS 255 . Subsec. (4): Subsec. is directed to the retailer and would not seem to affect the consumer in any way. 36 Conn.Supp. 255 .