2015 Connecticut General Statutes
Title 12 - Taxation
Chapter 219 - Sales and Use Taxes
Section 12-411 - The use tax.

(1) Imposition and rate. (A) An excise tax is hereby imposed on the storage, acceptance, consumption or any other use in this state of tangible personal property purchased from any retailer for storage, acceptance, consumption or any other use in this state, the acceptance or receipt of any services constituting a sale in accordance with subdivision (2) of subsection (a) of section 12-407, purchased from any retailer for consumption or use in this state, or the storage, acceptance, consumption or any other use in this state of tangible personal property which has been manufactured, fabricated, assembled or processed from materials by a person, either within or without this state, for storage, acceptance, consumption or any other use by such person in this state, to be measured by the sales price of materials, at the rate of six and thirty-five-hundredths per cent of the sales price of such property or services, except, in lieu of said rate of six and thirty-five-hundredths per cent;

(B) At a rate of fifteen per cent of the rent paid for occupancy of any room or rooms in a hotel or lodging house for the first period of not more than thirty consecutive calendar days;

(C) With respect to the storage, acceptance, consumption or use in this state of a motor vehicle purchased from any retailer for storage, acceptance, consumption or use in this state by 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 of such individual at a rate of four and one-half per cent of the sales price of such vehicle, 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 acceptance or receipt in this state 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 storage, acceptance or other use of a vessel in this state, such storage, acceptance or other use shall be exempt from such tax, provided such vessel is docked in this state for sixty or fewer days in a calendar year;

(E) (i) With respect to the acceptance or receipt in this state of computer and data processing services purchased from any retailer for consumption or use in this state occurring on or after July 1, 1997, and prior to July 1, 1998, at the rate of five per cent of such services, on or after July 1, 1998, and prior to July 1, 1999, at the rate of four per cent of such services, on or after July 1, 1999, and prior to July 1, 2000, at the rate of three per cent of such services, on or after July 1, 2000, and prior to July 1, 2001, at the rate of two per cent of such services, on and after July 1, 2001, at the rate of one per cent of such services, and (ii) with respect to the acceptance or receipt in this state of Internet access services, on or after July 1, 2001, such services shall be exempt from tax;

(F) With respect to the acceptance or receipt in this state of patient care services purchased from any retailer for consumption or use in this state 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; and

(I) For calendar quarters ending on or after September 30, 2011, 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.

(2) Liability for tax. Every person storing, accepting, consuming or otherwise using in this state services or tangible personal property purchased from a retailer for storage, acceptance, consumption or any other use in this state and every person storing, accepting, consuming or otherwise using in this state tangible personal property which has been manufactured, fabricated, assembled or processed from materials purchased from a retailer by such person, either within or without this state, for storage, acceptance, consumption or any other use by such person in this state is liable for the tax. Such person’s liability is not extinguished until the tax has been paid to this state, except that a receipt from a retailer engaged in business in this state or from a retailer who is authorized by the commissioner, under such regulations as the commissioner may prescribe, to collect the tax and who is, for the purposes of this chapter relating to the use tax, regarded as a retailer engaged in business in this state, given to the purchaser pursuant to subdivision (3) of this section is sufficient to relieve the purchaser from further liability for the tax to which the receipt refers.

(3) Collection by retailer. Every retailer engaged in business in this state and making sales of services or of tangible personal property for storage, acceptance, consumption or any other use in this state, not exempted under this chapter, shall, at the time of making a sale or, if the storage, acceptance, consumption or other use is not then taxable hereunder, at the time the storage, acceptance, consumption or use becomes taxable, collect the use tax from the purchaser and give to the purchaser a receipt therefor in the manner and form prescribed by the commissioner. For the purpose of uniformity of tax collection by the retailer the tax brackets set forth in subdivision (3) of section 12-408 pertaining to the sales tax shall be employed in the computation of the tax imposed by this section.

(4) Tax as debt. Amount collected deemed a special fund in trust for state. The tax required to be collected by the retailer constitutes a debt owed to the retailer by the person purchasing tangible personal property or services from such retailer. The amount of tax, when so collected, shall be deemed to be a special fund in trust for the state of Connecticut.

(5) Unlawful advertising. The provisions of subdivision (4) of section 12-408 pertaining to the sales tax shall apply with equal force to the use tax.

(6) Separate statement of tax. The tax required to be collected by the retailer from the purchaser shall be displayed separately from the list price, the price advertised in the premises, the marked price, or other price on the sales check or other proof of sales.

(7) Unlawful acts. Any person violating the provisions of subdivision (3), (5) or (6) of this section shall be fined five hundred dollars for each offense.

(8) Registration by retailers. Every retailer selling services or tangible personal property for storage, acceptance, consumption or any other use in this state shall register with the commissioner and give the name and address of all agents operating in this state, the location of all distribution or sales houses or offices or other places of business in this state and such other information as the commissioner may require.

(9) Presumption of purchase for use; resale certificate. For the purpose of the proper administration of this chapter and to prevent evasion of the use tax and the duty to collect the use tax, it shall be presumed that services or tangible personal property sold by any person for delivery in this state is sold for storage, acceptance, consumption or other use in this state until the contrary is established. The burden of proving the contrary is upon the person who makes the sale unless such person takes from the purchaser a certificate to the effect that the services or property is purchased for resale.

(10) Effect of certificate. The certificate relieves the person selling the services or property from the burden of proof only if taken in good faith from a person who is engaged in the business of selling services or tangible personal property and who holds the permit provided for by section 12-409 and who, at the time of purchasing the services or tangible personal property, intends to sell it in the regular course of business or is unable to ascertain at the time of purchase whether the service or property will be sold or will be used for some other purpose.

(11) Form of certificate. The certificate shall be signed by and bear the name and address of the purchaser, shall indicate the number of the permit issued to the purchaser and shall indicate the general character of the service or tangible personal property sold by the purchaser in the regular course of business. The certificate shall be substantially in such form as the commissioner may prescribe.

(12) Liability of purchaser. (A) If a purchaser who gives a certificate makes any storage or use of the service or property other than retention, demonstration or display while holding it for sale in the regular course of business, the storage or use is taxable as of the time the service or property is first so stored or used.

(B) Notwithstanding the provisions of subparagraph (A) of this subdivision, any storage or use by a certificated air carrier of an aircraft for purposes other than retention, demonstration or display while holding it for sale in the regular course of business shall not be deemed a taxable storage or use by such carrier as of the time the aircraft is first stored or used by such carrier, irrespective of the classification of such aircraft on the balance sheet of such carrier for accounting and tax purposes.

(13) Presumption of purchase from retailer. It shall be presumed that tangible personal property shipped or brought to this state by the purchaser was purchased from a retailer for storage, use or other consumption in this state.

(14) Conditions under which a purchase of service shall be considered a purchase for resale. Exception. (A) For the purpose of the proper administration of this chapter and to prevent evasion of the use tax, a purchase of any service described in subparagraph (I) of subdivision (2) of subsection (a) of section 12-407 shall be considered a purchase for resale only if the service to be resold is an integral, inseparable component part of a service described in said subparagraph (I) which is to be subsequently sold by the purchaser to an ultimate consumer. The purchaser of the service for resale shall maintain, in such form as the commissioner requires, records which substantiate: (i) From whom the service was purchased and to whom the service was sold; (ii) the purchase price of the service; and (iii) the nature of the service to demonstrate that the service was an integral, inseparable component part of a service described in subparagraph (I) of subdivision (2) of subsection (a) of section 12-407 which was subsequently sold to a consumer.

(B) Notwithstanding the provisions of subparagraph (A) of this subdivision, no purchase of a service described in subparagraph (I) of subdivision (2) of subsection (a) of section 12-407 by a purchaser shall be considered a purchase for resale if such service is to be subsequently sold by the purchaser to an ultimate consumer that is affiliated with the purchaser in the manner described in subparagraph (A) of subdivision (62) of subsection (a) of section 12-412.

(15) Sales to certain affiliates. For the purpose of the proper administration of this chapter and to prevent evasion of the use tax, no purchase of any service by a purchaser shall be considered a purchase for resale if such service is to be subsequently sold by the purchaser, without change, to an ultimate consumer that is affiliated with the purchaser in the manner described in subparagraph (A) of subdivision (62) of subsection (a) of section 12-412.

(1949 Rev., S. 2095; 1951, 1953, June, 1955, S. 1165d; November, 1955, S. N146; 1957, P.A. 553, S. 3; 1961, P.A. 574, S. 3, 4; June, 1969, P.A. 1, S. 20; June, 1971, P.A. 5, S. 107; 8, S. 5; 1972, P.A. 285, S. 3; P.A. 73-288, S. 3, 8; P.A. 74-73, S. 3, 5; 74-338, S. 74, 94; P.A. 75-2, S. 3, 5; 75-213, S. 26–32, 53; P.A. 76-114, S. 20, 21; 76-322, S. 21, 27; P.A. 77-370, S. 11, 13; 77-604, S. 77, 84; P.A. 78-71, S. 2, 5; P.A. 80-71, S. 19, 30; June Sp. Sess. P.A. 83-1, S. 9, 15; P.A. 85-240, S. 4, 6; P.A. 88-6, S. 4; 88-314, S. 24, 54; P.A. 89-123, S. 4; 89-251, S. 199, 203; P.A. 90-148, S. 23, 34; June Sp. Sess. P.A. 91-3, S. 113, 168; June Sp. Sess. P.A. 91-14, S. 24, 30; May Sp. Sess. P.A. 92-5, S. 27, 37; May Sp. Sess. P.A. 92-17, S. 27, 59; P.A. 93-332, S. 2, 5, 40, 42; P.A. 93-361, S. 12, 17; P.A. 95-359, S. 1, 19; P.A. 96-232, S. 2, 3; P.A. 97-243, S. 19, 20, 67; P.A. 98-110, S. 7, 27; 98-244, S. 18, 35; P.A. 99-173, S. 15, 65; P.A. 00-174, S. 6, 7, 83; June Sp. Sess. P.A. 01-6, S. 2, 65, 85; P.A. 02-3, S. 3; 02-103, S. 7; May 9 Sp. Sess. P.A. 02-1, S. 70; P.A. 03-2, S. 26; 03-225, S. 8; June 30 Sp. Sess. P.A. 03-1, S. 96; June Sp. Sess. P.A. 09-3, S. 110; P.A. 11-6, S. 97; 11-61, S. 183; P.A. 13-184, S. 78; 13-247, S. 319; P.A. 14-60, S. 7; 14-122, S. 97; P.A. 15-244, S. 73.)

History: 1961 act increased tax rate from 3% to 3.5%; 1969 act temporarily increased tax rate to 5% for period from July 1, 1969, to June 30, 1971; 1971 acts made 5% rate permanent and later increased rate to 6.5% as of September 1, 1971; 1972 act increased rate to 7%; P.A. 73-288 reduced rate to 6.5%; P.A. 74-73 reduced rate to 6%, effective May 31, 1974, and applicable to taxes imposed on and after May 1, 1974; P.A. 74-338 made technical changes; P.A. 75-2 increased rate to 7%; P.A. 75-213 included references to “acceptance” and “services” in Subsecs. (1) to (3) and (8) to (12); P.A. 76-114 set tax rate at 3.5% for machinery and services rendered pursuant to Sec. 12-407(2)(j)(A)–(M); P.A. 76-322 clarified Subsec. (1) by specifying 7% “of the sales price of the property”; P.A. 77-370 reduced tax rate on machinery to 2.5%; P.A. 77-604 made technical change to section reference in Subsec. (1); P.A. 78-71 deleted provision re 2.5% tax rate on machinery; P.A. 80-71 increased tax rate to 7.5%; June Sp. Sess. P.A. 83-1 amended Subsec. (1) by providing that the acceptance or receipt of any services constituting a sale in accordance with Sec. 12-407(2)(i) shall be subject to tax at the rate of 7.5% in lieu of 3.5% as previously provided; P.A. 85-240 amended Subsec. (12) to provide that aircraft held for sale by a certificated air carrier, if stored or used for purposes other than retention, demonstration or display, shall not be deemed to have been stored or used in a manner subject to sales tax; P.A. 88-6 amended Subsec. (12)(b) by substituting “aircraft” for “airplane” wherever the latter word appears; P.A. 88-314 amended Subsec. (7) by increasing the fine to $500 from not more than $100, effective July 1, 1988, and applicable to any tax which first becomes due and payable on or after said date, to any return or report due on or after said date, or in the case of any ongoing obligation imposed in accordance with said act, to the tax period next beginning on or after said date; P.A. 89-123 added provisions to Subsec. (1) to establish uniformity with sales tax provisions in Sec. 12-408(1); P.A. 89-251 increased the rate of tax in Subsec. (1) from 7.5% to 8% of the sales price of the property, with corresponding changes in the lower rates applicable to certain items of personal property; P.A. 90-148 added Subsec. (14) describing conditions under which a purchase of service shall be considered a sale for resale, effective July 1, 1990, and applicable to any purchase of service for resale on or after that date; June Sp. Sess. P.A. 91-3 amended Subsec. (1) to reduce the general rate to 6% to increase the rate with respect to the transfer of occupancy to 12% and to set the rate with respect to the storage, acceptance, consumption or use of vessels by nonresidents at the lesser of 6% or the rate in the home state of the nonresident, effective August 22, 1991, and applicable to sales occurring on or after October 1, 1991; June Sp. Sess. P.A. 91-14 amended Subsec. (1) to make the provisions relating to vessels effective September 19, 1991; May Sp. Sess. P.A. 92-5 amended Subsec. (1) to make various technical and minor changes, effective June 19, 1992, and applicable to sales occurring on or after July 1, 1992; May Sp. Sess. P.A. 92-17 amended Subsec. (1) to remove the special rate on aviation fuel, provided for an affidavit, rather than registration in the home state, as proof of out-of-state residence and made technical changes and amended Subsecs. (1) and (2) to clarify the standards for taxation of imported property, effective June 19, 1992, and applicable to sales occurring on or after July 1, 1992; P.A. 93-332 amended Subsec. (1) to provide that the sale of manufactured, fabricated, assembled or processed from materials be measured by the sales price of materials, effective June 25, 1993, and applicable to sales on or after July 1, 1993, and to exclude from tax mail order purchases of $200 or less, effective July 1, 1993, and applicable to sales occurring on or after July 1, 1993, and amended Subsec. (4) to provide that the tax collected constitutes a debt owed to the retailer by the purchaser and shall be deemed to be held in trust for the state, where previously tax was considered a debt owed by the retailer, effective June 25, 1993; P.A. 93-361 amended Subsec. (1) to delete exclusion from tax with regard to mail order purchase of $200 or less which had been added by P.A. 93-332, effective July 1, 1993, and applicable to sales occurring on or after July 1, 1993; P.A. 95-359 amended Subdiv. (14) to add provisions re maintenance of records by purchaser of services for resale and added Subparas. (A) to (C) listing requirements, effective July 13, 1995; P.A. 96-232 amended Subdiv. (1) to provide lower rates for tax on sale of repair or maintenance services on vessels, effective June 6, 1996, and applicable to sales occurring on and after July 1, 1997; P.A. 97-243 amended Subsec. (1) to add phase out of tax on computer and data processing, to add requirement that retailer maintain affidavit or other evidence with respect to sales of motor vehicles to members of the armed forces concerning the buyer’s state of residence, to provide that the tax rate on vessels sold to nonresidents is the lesser of 6% or the tax rate in the state in which the individual resides, and to make technical changes and amended Subsec. (7) to clarify that the fine is for each offense, effective June 24, 1997, and applicable to sales occurring on or after October 1, 1997; P.A. 98-110 amended Subsec. (1) to repeal Subdiv. (A) re repair or replacement parts and reletter remaining Subdivs., effective May 19, 1998, and applicable to sales occurring on or after January 1, 1999; P.A. 98-244 amended Subsec. (1)(c) to allow reduction in tax rate and exemption for military when the name of the spouse is on the title of the motor vehicle, effective June 8, 1998, and applicable to sales occurring on or after October 1, 1998; P.A. 99-173 amended Subsec. (1) to make a technical change, to reduce the tax rate to 4% effective July 1, 1999, to 2% on July 1, 2000, and eliminate the tax on July 1, 2001, for paving, painting, staining, wallpapering, roofing, siding, and exterior sheet metal work services on residential properties, and to reduce the tax rate on hospital services from 6% to 5.75% effective June 23, 1999, and applicable to sales occurring on or after July 1, 1999; P.A. 00-174 amended Subsec. (1) to eliminate an affidavit requirement for motor vehicle sales to armed forces personnel, to add provisions re declaration, to delete former Subdiv. (C) re tax on certain vessels and make conforming technical changes, to provide an exemption for certain labor to existing vessels in redesignated Subdiv. (C) and to delete requirement re furnishing of other states’ tax information by the commissioner, and amended Subsec. (9) to allow use of resale certificates in the case of sales of services and to make a technical change for purposes of gender neutrality, effective October 1, 2000, and applicable to sales made on or after that date; June Sp. Sess. P.A. 01-6 amended Subdiv. (1) to suspend the use tax on patient care services for the biennium commencing July 1, 2001, and ending June 30, 2003, in Subpara. (E) effective July 1, 2001, and applicable to sales occurring on or after that date, and to exempt Internet access services from the use tax in Subpara. (D), effective July 1, 2001; P.A. 02-3 amended Subdiv. (1) to provide that patient care services are those for which payment is received by the hospital, effective February 28, 2002; P.A. 02-103 made technical changes; May 9 Sp. Sess. P.A. 02-1 amended Subdiv. (1) to extend the rate for computer and data processing services until July 1, 2004, effective July 1, 2002, and applicable to sales occurring on or after said date; P.A. 03-2 amended Subdiv. (1) to add Subpara. (F) re 3% rate for certain advertising and public relations services, effective February 28, 2003, and applicable to sales occurring on or after April 1, 2003; P.A. 03-225 amended Subdiv. (14) by designating existing provisions as Subpara. (A) and amending same by replacing “sale for resale” with “purchase for resale” and making technical changes, and added new Subdivs. (14)(B) and (15) to prohibit the setting up of a separate purchasing company to purchase enumerated services on resale for a group of affiliates, effective October 1, 2003, and applicable to purchases occurring on or after that date; June 30 Sp. Sess. P.A. 03-11 amended Subdiv. (1) to delete sunset of tax on computer and data processing in Subpara. (D)(i), to eliminate tax on patient care services in Subpara. (E) and to remove provisions re certain advertising or public relations services which had been added as Subpara. (F) by P.A. 03-2, effective August 16, 2003, and applicable to sales occurring on or after July 1, 2003; June Sp. Sess. P.A. 09-3 amended Subdiv. (1) by decreasing tax rate from 6% to 5.5%, effective January 1, 2010 (Revisor’s note: The amendments made to Subdiv. (1) by Sec. 110 of June Sp. Sess. P.A. 09-3 did not take effect pursuant to Sec. 12-432c(a)); P.A. 11-6 amended Subdiv. (1) by designating existing language re imposition of tax as Subpara. (A) and amending same to increase tax rate from 6% to 6.35%, redesignating existing Subparas. (A) to (E) as Subparas. (B) to (F), increasing tax rate re room occupancy from 12% to 15% in Subpara. (B), adding Subpara. (G) re tax rate on motor vehicle rentals, adding Subpara. (H) re tax rate on luxury items, adding Subpara. (I) re deposits into municipal revenue sharing account, and adding Subpara. (J) re deposits into regional performance incentive account, effective July 1, 2011, and applicable to sales occurring on or after that date; P.A. 11-61 changed effective date of P.A. 11-6, S. 97, from July 1, 2011, and applicable to sales occurring on or after that date, to July 1, 2011, and applicable to sales occurring on or after that date, and to sales of services that are billed to customers for a period that includes that date, effective June 21, 2011; P.A. 13-184 amended Subdiv. (1) to designate existing provisions in Subpara. (D) as Subpara. (D)(i) and add Subpara. (D)(ii) re exemption for vessels docked in this state for 60 or fewer days, to eliminate former Subpara. (H)(ii) re luxury tax on vessels, to eliminate former Subpara. (I) re deposit into municipal revenue sharing account and redesignate existing Subpara. (J) as Subpara. (I), and to make technical changes, effective July 1, 2013; P.A. 13-247 amended Subdiv. (1)(J) by changing “regional performance incentive account” to “regional planning incentive account”, effective June 19, 2013; P.A. 14-60 made a technical change in Subdiv. (1)(B); P.A. 14-122 made technical changes in Subdiv. (1)(H); P.A. 15-244 amended Subdiv. (1)(H) to increase rate of luxury tax from 7 per cent to 7 3/4 per cent, effective July 1, 2015, and applicable to sales occurring on or after that date.