Connecticut Senate Bill SB01025 Introduced / Bill

                        
 
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General Assembly  Raised Bill No. 1025  
January Session, 2021 
LCO No. 4725 
 
 
Referred to Committee on PLANNING AND DEVELOPMENT  
 
 
Introduced by:  
(PD)  
 
 
 
 
AN ACT CONCERNING SH ORT-TERM RENTAL PROP ERTIES. 
Be it enacted by the Senate and House of Representatives in General 
Assembly convened: 
 
Section 1. (NEW) (Effective July 1, 2021) For the purposes of this 1 
section and sections 2 to 4, inclusive, of this act: 2 
(1) "Applicant" means a person who files an application with the 3 
commissioner pursuant to section 2 of this act; 4 
(2) "Commissioner" means the Commissioner of Consumer 5 
Protection; 6 
(3) "Dwelling unit" has the same meaning as provided in section 47a-7 
1 of the general statutes; 8 
(4) "Guest" means an individual, other than the owner, lessee, lessor, 9 
sublessee or sublessor of a short-term rental property, who occupies a 10 
short-term rental property pursuant to a short-term rental transaction; 11 
(5) "Short-term rental operator" means the owner, lessee or sublessee 12 
of a short-term rental property who offers the short-term rental property 13  Raised Bill No.  1025 
 
 
 
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for occupancy by a guest pursuant to a short-term rental transaction; 14 
(6) "Short-term rental platform" means any platform, including, but 15 
not limited to, an Internet web site, that (A) allows a short-term rental 16 
operator to offer a dwelling unit, or any portion thereof, for occupancy 17 
as a short-term rental property, (B) allows a potential guest to arrange 18 
payment for occupancy of a short-term rental property, whether such 19 
guest pays directly to a short-term rental operator or through the 20 
platform, and (C) allows the platform operator to derive revenues from 21 
providing or maintaining the services described in this subdivision for 22 
a short-term rental property; 23 
(7) "Short-term rental property" means a dwelling unit, or any portion 24 
thereof, in this state that is (A) the subject of a short-term rental 25 
transaction, and (B) not a hotel, lodging house or bed and breakfast 26 
establishment; and 27 
(8) "Short-term rental transaction" means a transaction in which a 28 
short-term rental operator offers a short-term rental property for 29 
occupancy by a guest through a short-term rental platform for a period 30 
of thirty consecutive calendar days or less. 31 
Sec. 2. (NEW) (Effective July 1, 2021) (a) (1) Each short-term rental 32 
operator or prospective short-term rental operator shall apply for a 33 
license from the commissioner for each dwelling unit that such person 34 
intends to operate as a short-term rental property on or after January 1, 35 
2022. Each application for a license, or renewal of a license, pursuant to 36 
this subsection shall be made on a form prescribed by the commissioner. 37 
The commissioner shall require, as a precondition to issuing or 38 
renewing a license pursuant to this subsection, that the applicant submit 39 
to the commissioner, in a form and manner prescribed by the 40 
commissioner, proof that the applicant: 41 
(A) Maintains a property and casualty insurance policy that contains 42 
the minimum provisions prescribed by the Insurance Commissioner 43 
pursuant to section 5 of this act; 44  Raised Bill No.  1025 
 
 
 
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(B) Provided all notices required by section 3 of this act; and 45 
(C) In the case of an application for renewal of a license under this 46 
subsection: 47 
(i) Maintained the insurance coverage described in subparagraph (A) 48 
of this subdivision during the two years immediately preceding; 49 
(ii) Paid any and all sales and use taxes due and payable to this state, 50 
and any and all taxes due and payable to a municipality pursuant to 51 
section 6 of this act, during the two years immediately preceding; 52 
(iii) Provided all notices required by section 3 of this act; and 53 
(iv) Complied with the provisions of any ordinance enacted pursuant 54 
to section 7 of this act during the two years immediately preceding. 55 
(2) Each license issued by the commissioner pursuant to this 56 
subsection shall expire two years after its issuance. The commissioner 57 
may refuse to issue or renew, or may suspend or revoke, any license 58 
required by this section if the applicant for such license or renewal 59 
engages in any conduct prohibited by this section. 60 
(3) Not later than fifteen days after the commissioner issues or renews 61 
a license pursuant to this subsection, the commissioner shall send a 62 
notice, in a form and manner prescribed by the commissioner, to the 63 
Commissioner of Revenue Services disclosing: 64 
(A) The name of the applicant for such license or renewal; and 65 
(B) The address of the licensed short-term rental property. 66 
(b) If the commissioner refuses to issue or renew, or suspends or 67 
revokes, a license pursuant to subsection (a) of this section, the 68 
commissioner shall notify the applicant or short-term rental operator, as 69 
applicable, of such decision, the grounds for such decision and of such 70 
applicant's or short-term rental operator's right to request a hearing not 71 
later than ten days after the date on which the commissioner issued such 72  Raised Bill No.  1025 
 
 
 
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notice to such applicant. If the applicant or short-term rental operator 73 
requests a hearing within such ten-day period, the commissioner shall 74 
conduct a hearing concerning such refusal, suspension or revocation in 75 
accordance with the provisions of chapter 54 of the general statutes 76 
concerning contested cases. The applicant or short-term rental operator 77 
may appeal therefrom in accordance with the provisions of section 4-78 
183 of the general statutes. 79 
(c) The Attorney General, at the request of the commissioner, is 80 
authorized to apply in the name of this state to the Superior Court for 81 
an order temporarily or permanently restraining and enjoining any 82 
short-term rental operator from operating in violation of any provision 83 
of sections 1 to 4, inclusive, of this act. 84 
Sec. 3. (NEW) (Effective July 1, 2021) Not later than the day that an 85 
applicant files an application with the commissioner pursuant to section 86 
2 of this act, the applicant shall send a notice, in a form and manner 87 
prescribed by the commissioner, to the owner, lessor or sublessor of the 88 
dwelling unit or short-term rental property that is the subject of such 89 
application, and all owners, lessors, lessees, sublessors and sublessees 90 
of abutting and adjacent dwelling units, disclosing: 91 
(1) The name of such applicant; 92 
(2) The address of such dwelling unit or short-term rental property; 93 
and 94 
(3) That such applicant has filed, or intends to file, such application. 95 
Sec. 4. (NEW) (Effective July 1, 2021) The commissioner may adopt 96 
regulations, in accordance with the provisions of chapter 54 of the 97 
general statutes, to implement the provisions of sections 1 to 3, inclusive, 98 
of this act. 99 
Sec. 5. (NEW) (Effective July 1, 2021) The Insurance Commissioner 100 
shall adopt regulations, in accordance with the provisions of chapter 54 101 
of the general statutes, prescribing the minimum provisions to be 102  Raised Bill No.  1025 
 
 
 
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included in each property and casualty policy issued on or after the 103 
effective date of such regulations covering a short-term rental property, 104 
as defined in section 1 of this act. Such policy shall include liability 105 
coverage of not less than one million dollars against claims for bodily 106 
injury or death and property damage. 107 
Sec. 6. (NEW) (Effective July 1, 2021) Any municipality may, by vote 108 
of its legislative body or, in a municipality where the legislative body is 109 
a town meeting, by vote of the board of selectmen, levy a tax on each 110 
short-term rental operator operating one or more short-term rental 111 
properties, as both terms are defined in section 1 of this act, within such 112 
municipality, provided such tax shall not exceed an amount that is equal 113 
to six per cent of such short-term rental operator's income from all short-114 
term rental transactions, as defined in section 1 of this act, concerning 115 
such short-term rental properties during the tax year for which such tax 116 
is levied. 117 
Sec. 7. (NEW) (Effective July 1, 2021) Any municipality may, by vote 118 
of its legislative body or, in a municipality where the legislative body is 119 
a town meeting, by vote of the board of selectmen, limit the number of 120 
days that guests may occupy a short-term rental property during a 121 
calendar year. For the purposes of this section, "guest" and "short-term 122 
rental property" have the same meaning as provided in section 1 of this 123 
act. 124 
Sec. 8. Section 12-407 of the general statutes is repealed and the 125 
following is substituted in lieu thereof (Effective July 1, 2021, and 126 
applicable to sales occurring on or after July 1, 2021): 127 
(a) Whenever used in this chapter: 128 
(1) "Person" means and includes any individual, firm, copartnership, 129 
joint venture, association, association of persons however formed, social 130 
club, fraternal organization, corporation, limited liability company, 131 
foreign municipal electric utility as defined in section 12-59, estate, trust, 132 
fiduciary, receiver, trustee, syndicate, the United States, this state or any 133 
political subdivision thereof or any group or combination acting as a 134  Raised Bill No.  1025 
 
 
 
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unit, and any other individual or officer acting under the authority of 135 
any court in this state. 136 
(2) "Sale" and "selling" mean and include: 137 
(A) Any transfer of title, exchange or barter, conditional or otherwise, 138 
in any manner or by any means whatsoever, of tangible personal 139 
property for a consideration; 140 
(B) Any withdrawal, except a withdrawal pursuant to a transaction 141 
in foreign or interstate commerce, of tangible personal property from 142 
the place where it is located for delivery to a point in this state for the 143 
purpose of the transfer of title, exchange or barter, conditional or 144 
otherwise, in any manner or by any means whatsoever, of the property 145 
for a consideration; 146 
(C) The producing, fabricating, processing, printing or imprinting of 147 
tangible personal property for a consideration for consumers who 148 
furnish either directly or indirectly the materials used in the producing, 149 
fabricating, processing, printing or imprinting, including, but not 150 
limited to, sign construction, photofinishing, duplicating and 151 
photocopying; 152 
(D) The furnishing and distributing of tangible personal property for 153 
a consideration by social clubs and fraternal organizations to their 154 
members or others; 155 
(E) The furnishing, preparing, or serving for a consideration of food, 156 
meals or drinks; 157 
(F) A transaction whereby the possession of property is transferred 158 
but the seller retains the title as security for the payment of the price; 159 
(G) A transfer for a consideration of the title of tangible personal 160 
property which has been produced, fabricated or printed to the special 161 
order of the customer, or of any publication, including, but not limited 162 
to, sign construction, photofinishing, duplicating and photocopying; 163  Raised Bill No.  1025 
 
 
 
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(H) A transfer for a consideration of the occupancy of any room or 164 
rooms in a hotel, lodging house, [or] bed and breakfast establishment or 165 
short-term rental property for a period of thirty consecutive calendar 166 
days or less; 167 
(I) The rendering of certain services, as defined in subdivision (37) of 168 
this subsection, for a consideration, exclusive of such services rendered 169 
by an employee for the employer; 170 
(J) The leasing or rental of tangible personal property of any kind 171 
whatsoever, including, but not limited to, motor vehicles, linen or 172 
towels, machinery or apparatus, office equipment and data processing 173 
equipment, provided for purposes of this subdivision and the 174 
application of sales and use tax to contracts of lease or rental of tangible 175 
personal property, the leasing or rental of any motion picture film by 176 
the owner or operator of a motion picture theater for purposes of display 177 
at such theater shall not constitute a sale within the meaning of this 178 
subsection; 179 
(K) The rendering of telecommunications service, as defined in 180 
subdivision (26) of this subsection, for a consideration on or after 181 
January 1, 1990, exclusive of any such service rendered by an employee 182 
for the employer of such employee, subject to the provisions related to 183 
telecommunications service in accordance with section 12-407a; 184 
(L) (i) The rendering of community antenna television service, as 185 
defined in subdivision (27) of this subsection, for a consideration on or 186 
after January 1, 1990, exclusive of any such service rendered by an 187 
employee for the employer of such employee. For purposes of this 188 
chapter, "community antenna television service" includes service 189 
provided by a holder of a certificate of cable franchise authority 190 
pursuant to section 16-331p, and service provided by a community 191 
antenna television company issued a certificate of video franchise 192 
authority pursuant to section 16-331e for any service area in which it 193 
was not certified to provide community antenna television service 194 
pursuant to section 16-331 on or before October 1, 2007; 195  Raised Bill No.  1025 
 
 
 
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(ii) The rendering of certified competitive video service, as defined in 196 
subdivision (38) of this subsection, for consideration on or after October 197 
1, 2007, exclusive of any such service rendered by an employee for the 198 
employer of such employee; 199 
(M) The transfer for consideration of space or the right to use any 200 
space for the purpose of storage or mooring of any noncommercial 201 
vessel, exclusive of dry or wet storage or mooring of such vessel during 202 
the period commencing on the first day of October in any year to and 203 
including the thirty-first day of May of the next succeeding year; 204 
(N) The sale for consideration of naming rights to any place of 205 
amusement, entertainment or recreation within the meaning of 206 
subdivision (3) of section 12-540; 207 
(O) The transfer for consideration of a prepaid telephone calling 208 
service, as defined in subdivision (34) of this subsection, and the 209 
recharge of a prepaid telephone calling service, provided, if the sale or 210 
recharge of a prepaid telephone calling service does not take place at the 211 
retailer's place of business and an item is shipped by the retailer to the 212 
customer, the sale or recharge shall be deemed to take place at the 213 
customer's shipping address, but, if such sale or recharge does not take 214 
place at the retailer's place of business and no item is shipped by the 215 
retailer to the customer, the sale or recharge shall be deemed to take 216 
place at the customer's billing address or the location associated with 217 
the customer's mobile telephone number; and 218 
(P) The furnishing by any person, for a consideration, of space for 219 
storage of tangible personal property when such person is engaged in 220 
the business of furnishing such space, but "sale" and "selling" do not 221 
mean or include the furnishing of space which is used by a person for 222 
residential purposes. As used in this subparagraph, "space for storage" 223 
means secure areas, such as rooms, units, compartments or containers, 224 
whether accessible from outside or from within a building, that are 225 
designated for the use of a customer, where the customer can store and 226 
retrieve property, including self-storage units, mini-storage units and 227  Raised Bill No.  1025 
 
 
 
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areas by any other name to which the customer has either unlimited free 228 
access or free access within reasonable business hours or upon 229 
reasonable notice to the service provider to add or remove property, but 230 
does not mean the rental of an entire building, such as a warehouse. For 231 
purposes of this subparagraph, furnishing space for storage shall not 232 
include general warehousing and storage, where the warehouse 233 
typically handles, stores and retrieves a customer's property using the 234 
warehouse's staff and equipment and does not allow the customer free 235 
access to the storage space and shall not include accepting specific items 236 
of property for storage, such as clothing at a dry cleaning establishment 237 
or golf bags at a golf club. 238 
(3) (A) "Retail sale" or "sale at retail" means and includes a sale for 239 
any purpose other than resale in the regular course of business of 240 
tangible personal property or a transfer for a consideration of the 241 
occupancy of any room or rooms in a hotel, lodging house, [or] bed and 242 
breakfast establishment or short-term rental property for a period of 243 
thirty consecutive calendar days or less, or the rendering of any service 244 
described in subdivision (2) of this subsection. The delivery in this state 245 
of tangible personal property by an owner or former owner thereof or 246 
by a factor, if the delivery is to a consumer pursuant to a retail sale made 247 
by a retailer not engaged in business in this state, is a retail sale in this 248 
state by the person making the delivery. Such person shall include the 249 
retail selling price of the property in such person's gross receipts. 250 
(B) "Retail sale" or "sale at retail" does not include any sale of any 251 
tangible personal property, where, no later than one hundred twenty 252 
days after the original sale, the original purchaser sells or becomes 253 
contractually obligated to sell such property to a retailer who is 254 
contractually obligated to lease such property back to such original 255 
purchaser in a lease that is taxable under this chapter or the sale of such 256 
property by the original purchaser to the retailer who is contractually 257 
obligated to lease such property back to such original purchaser in a 258 
lease that is taxable under this chapter. If the original purchaser has paid 259 
sales or use tax on the original sale of such property to the original 260 
purchaser, such original purchaser may (i) claim a refund of such tax 261  Raised Bill No.  1025 
 
 
 
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under the provisions of section 12-425, upon presentation of proof 262 
satisfactory to the commissioner that the mutual contractual obligations 263 
described in this subparagraph were undertaken no later than one 264 
hundred twenty days after the original sale and that such tax was paid 265 
to the original retailer on the original sale and was remitted to the 266 
commissioner by such original retailer or by such original purchaser, or 267 
(ii) issue at the time of such original sale or no later than one hundred 268 
twenty days thereafter a certificate, in the form prescribed by the 269 
commissioner, to the original retailer certifying that the mutual 270 
contractual obligations described in this subparagraph have been 271 
undertaken. If such certificate is issued to the original retailer at the time 272 
of the original sale, no tax on the original sale shall be collected by the 273 
original retailer from the original purchaser. If the certificate is issued 274 
after the time of the original sale but no later than one hundred twenty 275 
days thereafter, the original retailer shall refund to the original 276 
purchaser the tax collected on the original sale and, if the original 277 
retailer has previously remitted the tax to the commissioner, the original 278 
retailer may either treat the amount so refunded as a credit against the 279 
tax due on the return next filed under this chapter, or claim a refund 280 
under section 12-425. If such certificate is issued no later than one 281 
hundred twenty days after the time of the original sale but the tangible 282 
personal property originally purchased is not, in fact, subsequently 283 
leased by the original purchaser, such original purchaser shall be liable 284 
for and be required to pay the tax due on the original sale. 285 
(4) "Storage" includes any keeping or retention in this state for any 286 
purpose except sale in the regular course of business or subsequent use 287 
solely outside this state of tangible personal property purchased from a 288 
retailer. 289 
(5) "Use" includes the exercise of any right or power over tangible 290 
personal property incident to the ownership of that property, except 291 
that it does not include the sale of that property in the regular course of 292 
business. 293 
(6) "Storage" and "use" do not include (A) keeping, retaining or 294  Raised Bill No.  1025 
 
 
 
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exercising any right or power over tangible personal property shipped 295 
or brought into this state for the purpose of subsequently transporting 296 
it outside the state for use thereafter solely outside the state, or for the 297 
purpose of being processed, fabricated or manufactured into, attached 298 
to or incorporated into, other tangible personal property to be 299 
transported outside the state and thereafter used solely outside the state, 300 
or (B) keeping, retaining or exercising any right or power over tangible 301 
personal property acquired by the customer of a commercial printer 302 
while such property is located at the premises of the commercial printer 303 
in this state pursuant to a contract with such printer for printing and 304 
distribution of printed material if the commercial printer could have 305 
acquired such property without application of tax under this chapter. 306 
(7) "Purchase" and "purchasing" means and includes: (A) Any 307 
transfer, exchange or barter, conditional or otherwise, in any manner or 308 
by any means whatsoever, of tangible personal property or of the 309 
occupancy of any room or rooms in a hotel, lodging house, [or] bed and 310 
breakfast establishment or short-term rental property for a period of 311 
thirty consecutive calendar days or less for a consideration; (B) a 312 
transaction whereby the possession of property is transferred but the 313 
seller retains the title as security for the payment of the price; (C) a 314 
transfer for a consideration of tangible personal property which has 315 
been produced, fabricated or printed to the special order of the 316 
customer, or of any publication; (D) when performed outside this state 317 
or when the customer gives a resale certificate pursuant to section 12-318 
410, the producing, fabricating, processing, printing or imprinting of 319 
tangible personal property for a consideration for consumers who 320 
furnish either directly or indirectly the materials used in the producing, 321 
fabricating, processing, printing or imprinting; (E) the acceptance or 322 
receipt of any service described in any of the subparagraphs of 323 
subdivision (2) of this subsection; (F) any leasing or rental of tangible 324 
personal property. Wherever in this chapter reference is made to the 325 
purchase or purchasing of tangible personal property, it shall be 326 
construed to include purchases as described in this subsection. 327 
(8) (A) "Sales price" means the total amount for which tangible 328  Raised Bill No.  1025 
 
 
 
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personal property is sold by a retailer, the total amount of rent for which 329 
occupancy of a room is transferred by an operator, the total amount for 330 
which any service described in subdivision (2) of this subsection is 331 
rendered by a retailer or the total amount of payment or periodic 332 
payments for which tangible personal property is leased by a retailer, 333 
valued in money, whether paid in money or otherwise, which amount 334 
is due and owing to the retailer or operator and, subject to the provisions 335 
of subdivision (1) of section 12-408, as amended by this act, whether or 336 
not actually received by the retailer or operator, without any deduction 337 
on account of any of the following: (i) The cost of the property sold; (ii) 338 
the cost of materials used, labor or service cost, interest charged, losses 339 
or any other expenses; (iii) for any sale occurring on or after July 1, 1993, 340 
any charges by the retailer to the purchaser for shipping or delivery, 341 
notwithstanding whether such charges are separately stated in a written 342 
contract, or on a bill or invoice rendered to such purchaser or whether 343 
such shipping or delivery is provided by the retailer or a third party. 344 
The provisions of subparagraph (A) (iii) of this subdivision shall not 345 
apply to any item exempt from taxation pursuant to section 12-412. Such 346 
total amount includes any services that are a part of the sale; except as 347 
otherwise provided in subparagraph (B)(v) or (B)(vi) of this subdivision, 348 
any amount for which credit is given to the purchaser by the retailer, 349 
and all compensation and all employment-related expenses, whether or 350 
not separately stated, paid to or on behalf of employees of a retailer of 351 
any service described in subdivision (2) of this subsection. 352 
(B) "Sales price" does not include any of the following: (i) Cash 353 
discounts allowed and taken on sales; (ii) any portion of the amount 354 
charged for property returned by purchasers, which upon rescission of 355 
the contract of sale is refunded either in cash or credit, provided the 356 
property is returned within ninety days from the date of purchase; (iii) 357 
the amount of any tax, not including any manufacturers' or importers' 358 
excise tax, imposed by the United States upon or with respect to retail 359 
sales whether imposed upon the retailer or the purchaser; (iv) the 360 
amount charged for labor rendered in installing or applying the 361 
property sold, provided such charge is separately stated and exclusive 362  Raised Bill No.  1025 
 
 
 
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of such charge for any service rendered within the purview of 363 
subparagraph (I) of subdivision (37) of this subsection; (v) unless the 364 
provisions of subdivision (4) of section 12-430 or of section 12-430a are 365 
applicable, any amount for which credit is given to the purchaser by the 366 
retailer, provided such credit is given solely for property of the same 367 
kind accepted in part payment by the retailer and intended by the 368 
retailer to be resold; (vi) the full face value of any coupon used by a 369 
purchaser to reduce the price paid to a retailer for an item of tangible 370 
personal property, whether or not the retailer will be reimbursed for 371 
such coupon, in whole or in part, by the manufacturer of the item of 372 
tangible personal property or by a third party; (vii) the amount charged 373 
for separately stated compensation, fringe benefits, workers' 374 
compensation and payroll taxes or assessments paid to or on behalf of 375 
employees of a retailer who has contracted to manage a service 376 
recipient's property or business premises and renders management 377 
services described in subparagraph (I) or (J) of subdivision (37) of this 378 
subsection, provided, the employees perform such services solely for 379 
the service recipient at its property or business premises and "sales 380 
price" shall include the separately stated compensation, fringe benefits, 381 
workers' compensation and payroll taxes or assessments paid to or on 382 
behalf of any employee of the retailer who is an officer, director or 383 
owner of more than five per cent of the outstanding capital stock of the 384 
retailer. Determination whether an employee performs services solely 385 
for a service recipient at its property or business premises for purposes 386 
of this subdivision shall be made by reference to such employee's 387 
activities during the time period beginning on the later of the 388 
commencement of the management contract, the date of the employee's 389 
first employment by the retailer or the date which is six months 390 
immediately preceding the date of such determination; (viii) the amount 391 
charged for separately stated compensation, fringe benefits, workers' 392 
compensation and payroll taxes or assessments paid to or on behalf of 393 
(I) a leased employee, or (II) a worksite employee by a professional 394 
employer organization pursuant to a professional employer agreement. 395 
For purposes of this subparagraph, an employee shall be treated as a 396 
leased employee if the employee is provided to the client at the 397  Raised Bill No.  1025 
 
 
 
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commencement of an agreement with an employee leasing organization 398 
under which at least seventy-five per cent of the employees provided to 399 
the client at the commencement of such initial agreement qualify as 400 
leased employees pursuant to Section 414(n) of the Internal Revenue 401 
Code of 1986, or any subsequent corresponding internal revenue code 402 
of the United States, as from time to time amended, or the employee is 403 
added to the client's workforce by the employee leasing organization 404 
subsequent to the commencement of such initial agreement and 405 
qualifies as a leased employee pursuant to Section 414(n) of said Internal 406 
Revenue Code of 1986 without regard to subparagraph (B) of paragraph 407 
(2) thereof. A leased employee, or a worksite employee subject to a 408 
professional employer agreement, shall not include any employee who 409 
is hired by a temporary help service and assigned to support or 410 
supplement the workforce of a temporary help service's client; (ix) any 411 
amount received by a retailer from a purchaser as the battery deposit 412 
that is required to be paid under subsection (a) of section 22a-245h; the 413 
refund value of a beverage container that is required to be paid under 414 
subsection (a) of section 22a-244; or a deposit that is required by law to 415 
be paid by the purchaser to the retailer and that is required by law to be 416 
refunded to the purchaser by the retailer when the same or similar 417 
tangible personal property is delivered as required by law to the retailer 418 
by the purchaser, if such amount is separately stated on the bill or 419 
invoice rendered by the retailer to the purchaser; and (x) the amount 420 
charged for separately stated compensation, fringe benefits, workers' 421 
compensation and payroll taxes or assessments paid to a media payroll 422 
services company, as defined in this subsection. 423 
(9) (A) "Gross receipts" means the total amount of the sales price from 424 
retail sales of tangible personal property by a retailer, the total amount 425 
of the rent from transfers of occupancy of rooms by an operator, the total 426 
amount of the sales price from retail sales of any service described in 427 
subdivision (2) of this subsection by a retailer of services, or the total 428 
amount of payment or periodic payments from leases or rentals of 429 
tangible personal property by a retailer, valued in money, whether 430 
received in money or otherwise, which amount is due and owing to the 431  Raised Bill No.  1025 
 
 
 
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retailer or operator and, subject to the provisions of subdivision (1) of 432 
section 12-408, as amended by this act, whether or not actually received 433 
by the retailer or operator, without any deduction on account of any of 434 
the following: (i) The cost of the property sold; however, in accordance 435 
with such regulations as the Commissioner of Revenue Services may 436 
prescribe, a deduction may be taken if the retailer has purchased 437 
property for some other purpose than resale, has reimbursed the 438 
retailer's vendor for tax which the vendor is required to pay to the state 439 
or has paid the use tax with respect to the property, and has resold the 440 
property prior to making any use of the property other than retention, 441 
demonstration or display while holding it for sale in the regular course 442 
of business. If such a deduction is taken by the retailer, no refund or 443 
credit will be allowed to the retailer's vendor with respect to the sale of 444 
the property; (ii) the cost of the materials used, labor or service cost, 445 
interest paid, losses or any other expense; (iii) for any sale occurring on 446 
or after July 1, 1993, except for any item exempt from taxation pursuant 447 
to section 12-412, any charges by the retailer to the purchaser for 448 
shipping or delivery, notwithstanding whether such charges are 449 
separately stated in the written contract, or on a bill or invoice rendered 450 
to such purchaser or whether such shipping or delivery is provided by 451 
the retailer or a third party. The total amount of the sales price includes 452 
any services that are a part of the sale; all receipts, cash, credits and 453 
property of any kind; except as otherwise provided in subparagraph 454 
(B)(v) or (B)(vi) of this subdivision, any amount for which credit is 455 
allowed by the retailer to the purchaser; and all compensation and all 456 
employment-related expenses, whether or not separately stated, paid to 457 
or on behalf of employees of a retailer of any service described in 458 
subdivision (2) of this subsection. 459 
(B) "Gross receipts" do not include any of the following: (i) Cash 460 
discounts allowed and taken on sales; (ii) any portion of the sales price 461 
of property returned by purchasers, which upon rescission of the 462 
contract of sale is refunded either in cash or credit, provided the 463 
property is returned within ninety days from the date of sale; (iii) the 464 
amount of any tax, not including any manufacturers' or importers' 465  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	16 of 54 
 
excise tax, imposed by the United States upon or with respect to retail 466 
sales whether imposed upon the retailer or the purchaser; (iv) the 467 
amount charged for labor rendered in installing or applying the 468 
property sold, provided such charge is separately stated and exclusive 469 
of such charge for any service rendered within the purview of 470 
subparagraph (I) of subdivision (37) of this subsection; (v) unless the 471 
provisions of subdivision (4) of section 12-430 or of section 12-430a are 472 
applicable, any amount for which credit is given to the purchaser by the 473 
retailer, provided such credit is given solely for property of the same 474 
kind accepted in part payment by the retailer and intended by the 475 
retailer to be resold; (vi) the full face value of any coupon used by a 476 
purchaser to reduce the price paid to the retailer for an item of tangible 477 
personal property, whether or not the retailer will be reimbursed for 478 
such coupon, in whole or in part, by the manufacturer of the item of 479 
tangible personal property or by a third party; (vii) the amount charged 480 
for separately stated compensation, fringe benefits, workers' 481 
compensation and payroll taxes or assessments paid to or on behalf of 482 
employees of a retailer who has contracted to manage a service 483 
recipient's property or business premises and renders management 484 
services described in subparagraph (I) or (J) of subdivision (37) of this 485 
subsection, provided the employees perform such services solely for the 486 
service recipient at its property or business premises and "gross 487 
receipts" shall include the separately stated compensation, fringe 488 
benefits, workers' compensation and payroll taxes or assessments paid 489 
to or on behalf of any employee of the retailer who is an officer, director 490 
or owner of more than five per cent of the outstanding capital stock of 491 
the retailer. Determination whether an employee performs services 492 
solely for a service recipient at its property or business premises for 493 
purposes of this subdivision shall be made by reference to such 494 
employee's activities during the time period beginning on the later of 495 
the commencement of the management contract, the date of the 496 
employee's first employment by the retailer or the date which is six 497 
months immediately preceding the date of such determination; (viii) the 498 
amount charged for separately stated compensation, fringe benefits, 499 
workers' compensation and payroll taxes or assessments paid to or on 500  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	17 of 54 
 
behalf of (I) a leased employee, or (II) a worksite employee by a 501 
professional employer organization pursuant to a professional 502 
employer agreement. For purposes of this subparagraph, an employee 503 
shall be treated as a leased employee if the employee is provided to the 504 
client at the commencement of an agreement with an employee leasing 505 
organization under which at least seventy-five per cent of the employees 506 
provided to the client at the commencement of such initial agreement 507 
qualify as leased employees pursuant to Section 414(n) of the Internal 508 
Revenue Code of 1986, or any subsequent corresponding internal 509 
revenue code of the United States, as from time to time amended, or the 510 
employee is added to the client's workforce by the employee leasing 511 
organization subsequent to the commencement of such initial 512 
agreement and qualifies as a leased employee pursuant to Section 414(n) 513 
of said Internal Revenue Code of 1986 without regard to subparagraph 514 
(B) of paragraph (2) thereof. A leased employee, or a worksite employee 515 
subject to a professional employer agreement, shall not include any 516 
employee who is hired by a temporary help service and assigned to 517 
support or supplement the workforce of a temporary help service's 518 
client; (ix) the amount received by a retailer from a purchaser as the 519 
battery deposit that is required to be paid under subsection (a) of section 520 
22a-256h; the refund value of a beverage container that is required to be 521 
paid under subsection (a) of section 22a-244 or a deposit that is required 522 
by law to be paid by the purchaser to the retailer and that is required by 523 
law to be refunded to the purchaser by the retailer when the same or 524 
similar tangible personal property is delivered as required by law to the 525 
retailer by the purchaser, if such amount is separately stated on the bill 526 
or invoice rendered by the retailer to the purchaser; and (x) the amount 527 
charged for separately stated compensation, fringe benefits, workers' 528 
compensation and payroll taxes or assessments paid to a media payroll 529 
services company, as defined in this subsection. 530 
(10) "Business" includes any activity engaged in by any person or 531 
caused to be engaged in by any person with the object of gain, benefit 532 
or advantage, either direct or indirect. 533 
(11) "Seller" includes every person engaged in the business of selling 534  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	18 of 54 
 
tangible personal property or rendering any service described in any of 535 
the subparagraphs of subdivision (2) of this subsection, the gross 536 
receipts from the retail sale of which are required to be included in the 537 
measure of the sales tax and every operator as defined in subdivision 538 
(18) of this subsection. 539 
(12) "Retailer" includes:  540 
(A) Every person engaged in the business of making sales at retail or 541 
in the business of making retail sales at auction of tangible personal 542 
property owned by the person or others;  543 
(B) Every person engaged in the business of making sales for storage, 544 
use or other consumption or in the business of making sales at auction 545 
of tangible personal property owned by the person or others for storage, 546 
use or other consumption;  547 
(C) Every operator, as defined in subdivision (18) of this subsection;  548 
(D) Every seller rendering any service described in subdivision (2) of 549 
this subsection;  550 
(E) Every person under whom any salesman, representative, peddler 551 
or canvasser operates in this state, or from whom such salesman, 552 
representative, peddler or canvasser obtains the tangible personal 553 
property that is sold; 554 
(F) Every person with whose assistance any seller is enabled to solicit 555 
orders within this state;  556 
(G) Every person making retail sales of tangible personal property or 557 
services from outside this state to a destination within this state, 558 
provided such person has gross receipts of at least one hundred 559 
thousand dollars and made two hundred or more retail sales from 560 
outside this state to destinations within this state during the twelve-561 
month period ended on the September thirtieth immediately preceding 562 
the monthly or quarterly period with respect to which such person's 563 
liability for tax under this chapter is determined;  564  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	19 of 54 
 
(H) Any person owned or controlled, either directly or indirectly, by 565 
a retailer engaged in business in this state which is the same as or similar 566 
to the line of business in which such person so owned or controlled is 567 
engaged;  568 
(I) Any person owned or controlled, either directly or indirectly, by 569 
the same interests that own or control, either directly or indirectly, a 570 
retailer engaged in business in this state which is the same as or similar 571 
to the line of business in which such person so owned or controlled is 572 
engaged;  573 
(J) Any assignee of a person engaged in the business of leasing 574 
tangible personal property to others, where leased property of such 575 
person which is subject to taxation under this chapter is situated within 576 
this state and such assignee has a security interest, as defined in 577 
subdivision (35) of subsection (b) of section 42a-1-201, in such property;  578 
(K) Every person making retail sales of items of tangible personal 579 
property from outside this state to a destination within this state who 580 
repairs or services such items, under a warranty, in this state, either 581 
directly or indirectly through an agent, independent contractor or 582 
subsidiary;  583 
(L) Every person making sales of tangible personal property or 584 
services through an agreement with another person located in this state 585 
under which such person located in this state, for a commission or other 586 
consideration that is based upon the sale of tangible personal property 587 
or services by the retailer, directly or indirectly refers potential 588 
customers, whether by a link on an Internet web site or otherwise, to the 589 
retailer, provided the cumulative gross receipts from sales by the retailer 590 
to customers in the state who are referred to the retailer by all such 591 
persons with this type of an agreement with the retailer, is in excess of 592 
one hundred thousand dollars during the preceding four quarterly 593 
periods ending on the last day of March, June, September and 594 
December;  595 
(M) Any marketplace facilitator, as defined in section 12-408e; and 596  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	20 of 54 
 
(N) Any short-term rental facilitator, as defined in section 12-408h. 597 
(13) "Tangible personal property" means personal property that may 598 
be seen, weighed, measured, felt or touched or that is in any other 599 
manner perceptible to the senses. "Tangible personal property" includes 600 
(A) digital goods, (B) canned or prewritten computer software, 601 
including canned or prewritten software that is electronically accessed 602 
or transferred, other than when purchased by a business for use by such 603 
business, and any additional content related to such software, and (C) 604 
the distribution, generation or transmission of electricity. 605 
(14) "In this state" or "in the state" means within the exterior limits of 606 
the state of Connecticut and includes all territory within these limits 607 
owned by or ceded to the United States of America. 608 
(15) (A) "Engaged in business in the state" means and, to the extent 609 
not prohibited by the Constitution of the United States, includes, but 610 
shall not be limited to, the following acts or methods of transacting 611 
business: 612 
(i) Selling in this state, or any activity in this state in connection with 613 
selling in this state, tangible personal property for use, storage or 614 
consumption within the state; 615 
(ii) Engaging in the transfer for a consideration of the occupancy of 616 
any room or rooms in a hotel, lodging house [or] bed and breakfast 617 
establishment or short-term rental property for a period of thirty 618 
consecutive calendar days or less; 619 
(iii) Rendering in this state any service described in any of the 620 
subparagraphs of subdivision (2) of this subsection; 621 
(iv) Maintaining, occupying or using, permanently or temporarily, 622 
directly or indirectly, through a subsidiary or agent, by whatever name 623 
called, any office, place of distribution, sales or sample room or place, 624 
warehouse or storage point or other place of business or having any 625 
representative, agent, salesman, canvasser or solicitor operating in this 626  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	21 of 54 
 
state for the purpose of selling, delivering or taking orders; 627 
(v) Selling tangible personal property or services from outside this 628 
state to a destination within this state, provided at least one hundred 629 
thousand dollars of gross receipts are received and two hundred or 630 
more retail sales from outside this state to destinations within this state 631 
are made during the twelve-month period ended on the September 632 
thirtieth immediately preceding the monthly or quarterly period with 633 
respect to which liability for tax under this chapter is determined; 634 
(vi) Being owned or controlled, either directly or indirectly, by a 635 
retailer engaged in business in this state which is the same as or similar 636 
to the line of business in which the retailer so owned or controlled is 637 
engaged; 638 
(vii) Being owned or controlled, either directly or indirectly, by the 639 
same interests that own or control, either directly or indirectly, a retailer 640 
engaged in business in this state which is the same as or similar to the 641 
line of business in which the retailer so owned or controlled is engaged; 642 
(viii) Being the assignee of a person engaged in the business of leasing 643 
tangible personal property to others, where leased property of such 644 
person is situated within this state and such assignee has a security 645 
interest, as defined in subdivision (35) of subsection (b) of section 42a-1-646 
201, in such property; 647 
(ix) Notwithstanding the fact that retail sales of items of tangible 648 
personal property are made from outside this state to a destination 649 
within this state, repairing or servicing such items, under a warranty, in 650 
this state, either directly or indirectly through an agent, independent 651 
contractor or subsidiary; and 652 
(x) Selling tangible personal property or services through an 653 
agreement with a person located in this state, under which such person 654 
located in this state, for a commission or other consideration that is 655 
based upon the sale of tangible personal property or services by the 656 
retailer, directly or indirectly refers potential customers, whether by a 657  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	22 of 54 
 
link on an Internet web site or otherwise, to the retailer, provided the 658 
cumulative gross receipts from sales by the retailer to customers in the 659 
state who are referred to the retailer by all such persons with this type 660 
of agreement with the retailer is in excess of one hundred thousand 661 
dollars during the four preceding four quarterly periods ending on the 662 
last day of March, June, September and December. 663 
(B) A retailer who has contracted with a commercial printer for 664 
printing and distribution of printed material shall not be deemed to be 665 
engaged in business in this state because of the ownership or leasing by 666 
the retailer of tangible or intangible personal property located at the 667 
premises of the commercial printer in this state, the sale by the retailer 668 
of property of any kind produced or processed at and shipped or 669 
distributed from the premises of the commercial printer in this state, the 670 
activities of the retailer's employees or agents at the premises of the 671 
commercial printer in this state, which activities relate to quality control, 672 
distribution or printing services performed by the printer, or the 673 
activities of any kind performed by the commercial printer in this state 674 
for or on behalf of the retailer. 675 
(C) A retailer not otherwise engaged in business in the state who 676 
purchases fulfillment services carried on in this state by a person other 677 
than an affiliated person, or who owns tangible personal property 678 
located on the premises of an unaffiliated person other than a 679 
marketplace facilitator, as defined in section 12-408e, performing 680 
fulfillment services for such retailer, shall not be deemed to be engaged 681 
in business in this state. For purposes of this subparagraph, (i) persons 682 
are affiliated persons with respect to each other where one of such 683 
persons has an ownership interest of more than five per cent, whether 684 
direct or indirect, in the other, or where an ownership interest of more 685 
than five per cent, whether direct or indirect, is held in each of such 686 
persons by another person or by a group of other persons who are 687 
affiliated persons with respect to each other, and (ii) "fulfillment 688 
services" means services that are performed by a person on its premises 689 
on behalf of a purchaser of such services and that involve the receipt of 690 
orders from the purchaser of such services or an agent thereof, which 691  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	23 of 54 
 
orders are to be filled by the person from an inventory of products that 692 
are offered for sale by the purchaser of such services, and the shipment 693 
of such orders outside this state to customers of the purchaser of such 694 
services. 695 
(D) A retailer not otherwise engaged in business in this state that 696 
participates in a trade show or shows at the convention center, as 697 
defined in subdivision (3) of section 32-600, shall not be deemed to be 698 
engaged in business in this state, regardless of whether the retailer has 699 
employees or other staff present at such trade shows, provided the 700 
retailer's activity at such trade shows is limited to displaying goods or 701 
promoting services, no sales are made, any orders received are sent 702 
outside this state for acceptance or rejection and are filled from outside 703 
this state, and provided further that such participation is not more than 704 
fourteen days, or part thereof, in the aggregate during the retailer's 705 
income year for federal income tax purposes. 706 
(16) "Hotel" means any building regularly used and kept open as such 707 
for the feeding and lodging of guests where any person who conducts 708 
himself properly and who is able and ready to pay for such services is 709 
received if there are accommodations for such person and which derives 710 
the major portion of its operating receipts from the renting of rooms and 711 
the sale of food. "Hotel" includes any apartment hotel wherein 712 
apartments are rented for fixed periods of time, furnished or 713 
unfurnished, while the keeper of such hotel supplies food to the 714 
occupants thereof, if required, but does not include a bed and breakfast 715 
establishment or short-term rental property. 716 
(17) "Lodging house" means any building or portion of a building, 717 
other than a hotel, an apartment hotel, [or] a bed and breakfast 718 
establishment or a short term-rental property, in which persons are 719 
lodged for hire with or without meals, including, but not limited to, any 720 
motel, motor court, motor inn, tourist court, furnished residence or 721 
similar accommodation; provided the terms "hotel", "apartment hotel", 722 
"lodging house", [and "bed and breakfast"] "bed and breakfast 723 
establishment" and "short term rental property" shall not be construed 724  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	24 of 54 
 
to include: (A) Privately owned and operated convalescent homes, 725 
residential care homes, homes for the infirm, indigent or chronically ill; 726 
(B) religious or charitable homes for the aged, infirm, indigent or 727 
chronically ill; (C) privately owned and operated summer camps for 728 
children; (D) summer camps for children operated by religious or 729 
charitable organizations; (E) lodging accommodations at educational 730 
institutions; or (F) lodging accommodations at any facility operated by 731 
and in the name of any nonprofit charitable organization, provided the 732 
income from such lodging accommodations at such facility is not subject 733 
to federal income tax. 734 
(18) "Operator" means any person operating a hotel, lodging house, 735 
[or] bed and breakfast establishment or short-term rental property in the 736 
state, including, but not limited to, the owner or proprietor of such 737 
premises, lessee, sublessee, mortgagee in possession, licensee or any 738 
other person otherwise operating such hotel, lodging house, [or] bed 739 
and breakfast establishment or short-term rental property. 740 
(19) "Occupancy" means the use or possession, or the right to the use 741 
or possession, of any room or rooms in a hotel, lodging house, [or] bed 742 
and breakfast establishment or short-term rental property, or the right 743 
to the use or possession of the furnishings or the services and 744 
accommodations accompanying the use and possession of such room or 745 
rooms, for the first period of not more than thirty consecutive calendar 746 
days. 747 
(20) "Room" means any room or rooms of any kind in any part or 748 
portion of a hotel, lodging house, [or] bed and breakfast establishment 749 
or short-term rental property let out for use or possession for lodging 750 
purposes. 751 
(21) "Rent" means the consideration received for occupancy and any 752 
meals included with such occupancy, valued in money, whether 753 
received in money or otherwise, including all receipts, cash, credits and 754 
property or services of any kind or nature, and also any amount for 755 
which credit is allowed by the operator to the occupant, without any 756  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	25 of 54 
 
deduction therefrom whatsoever. 757 
(22) "Certificated air carrier" means a person issued a certificate or 758 
certificates by the Federal Aviation Administration pursuant to Title 14, 759 
Chapter I, Subchapter G, Part 121, 135, 139 or 141 of the Code of Federal 760 
Regulations or the Civil Aeronautics Board pursuant to Title 14, Chapter 761 
II, Subchapter A, Parts 201 to 208, inclusive, and 298 of the Code of 762 
Federal Regulations, as such regulations may hereafter be amended or 763 
reclassified. 764 
(23) "Aircraft" means aircraft, as the term is defined in section 15-34. 765 
(24) "Vessel" means vessel, as the term is defined in section 15-127. 766 
(25) "Licensed marine dealer" means a marine dealer, as the term is 767 
defined in section 15-141, who has been issued a marine dealer's 768 
certificate by the Commissioner of Energy and Environmental 769 
Protection. 770 
(26) (A) "Telecommunications service" means the electronic 771 
transmission, conveyance or routing of voice, image, data, audio, video 772 
or any other information or signals to a point or between or among 773 
points. "Telecommunications service" includes such transmission, 774 
conveyance or routing in which computer processing applications are 775 
used to act on the form, code or protocol of the content for purposes of 776 
transmission, conveyance or routing without regard to whether such 777 
service is referred to as a voice over Internet protocol service or is 778 
classified by the Federal Communications Commission as enhanced or 779 
value added. "Telecommunications service" does not include (i) value-780 
added nonvoice data services, (ii) radio and television audio and video 781 
programming services, regardless of the medium, including the 782 
furnishing of transmission, conveyance or routing of such services by 783 
the programming service provider. Radio and television audio and 784 
video programming services shall include, but not be limited to, cable 785 
service as defined in 47 USC 522(6), audio and video programming 786 
services delivered by commercial mobile radio service providers, as 787 
defined in 47 CFR 20, and video programming service by certified 788  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	26 of 54 
 
competitive video service providers, (iii) any telecommunications 789 
service (I) rendered by a company in control of such service when 790 
rendered for private use within its organization, or (II) used, allocated 791 
or distributed by a company within its organization, including in such 792 
organization affiliates, as defined in section 33-840, for the purpose of 793 
conducting business transactions of the organization if such service is 794 
purchased or leased from a company rendering telecommunications 795 
service and such purchase or lease is subject to tax under this chapter, 796 
(iv) access or interconnection service purchased by a provider of 797 
telecommunications service from another provider of such service for 798 
purposes of rendering such service, provided the purchaser submits to 799 
the seller a certificate attesting to the applicability of this exclusion, upon 800 
receipt of which the seller is relieved of any tax liability for such sale so 801 
long as the certificate is taken in good faith by the seller, (v) data 802 
processing and information services that allow data to be generated, 803 
acquired, stored, processed or retrieved and delivered by an electronic 804 
transmission to a purchaser where such purchaser's primary purpose 805 
for the underlying transaction is the processed data or information, (vi) 806 
installation or maintenance of wiring equipment on a customer's 807 
premises, (vii) tangible personal property, (viii) advertising, including, 808 
but not limited to, directory advertising, (ix) billing and collection 809 
services provided to third parties, (x) Internet access service, (xi) 810 
ancillary services, and (xii) digital products delivered electronically, 811 
including, but not limited to, software, music, video, reading materials 812 
or ring tones. 813 
(B) For purposes of the tax imposed under this chapter (i) gross 814 
receipts from the rendering of telecommunications service shall include 815 
any subscriber line charge or charges as required by the Federal 816 
Communications Commission and any charges for access service 817 
collected by any person rendering such service unless otherwise 818 
excluded from such gross receipts under this chapter, and such gross 819 
receipts from the rendering of telecommunications service shall also 820 
include any charges for vertical service, for the installation or 821 
maintenance of wiring equipment on a customer's premises, and for 822  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	27 of 54 
 
directory assistance service; (ii) gross receipts from the rendering of 823 
telecommunications service shall not include any local charge for calls 824 
from public or semipublic telephones; and (iii) gross receipts from the 825 
rendering of telecommunications service shall not include any charge 826 
for calls purchased using a prepaid telephone calling service, as defined 827 
in subdivision (34) of this subsection. 828 
(27) "Community antenna television service" means (A) the one-way 829 
transmission to subscribers of video programming or information by 830 
cable, fiber optics, satellite, microwave or any other means, and 831 
subscriber interaction, if any, which is required for the selection of such 832 
video programming or information, and (B) noncable communications 833 
service, as defined in section 16-1, unless such noncable 834 
communications service is purchased by a cable network as that term is 835 
used in subsection (k) of section 12-218. 836 
(28) "Hospital" means a hospital included within the definition of 837 
health care facilities or institutions under section 19a-630 and licensed 838 
as a short-term general hospital by the Department of Public Health, but 839 
does not include (A) any hospital which, on January 30, 1997, is within 840 
the class of hospitals licensed by the department as children's general 841 
hospitals, or (B) a short-term acute hospital operated exclusively by the 842 
state other than a short-term acute hospital operated by the state as a 843 
receiver pursuant to chapter 920. 844 
(29) "Patient care services" means therapeutic and diagnostic medical 845 
services provided by the hospital to inpatients and outpatients 846 
including tangible personal property transferred in connection with 847 
such services. 848 
(30) "Another state" or "other state" means any state of the United 849 
States or the District of Columbia excluding the state of Connecticut. 850 
(31) "Professional employer agreement" means a written contract 851 
between a professional employer organization and a service recipient 852 
whereby the professional employer organization agrees to provide at 853 
least seventy-five per cent of the employees at the service recipient's 854  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	28 of 54 
 
worksite, which contract provides that such worksite employees are 855 
intended to be permanent employees rather than temporary employees, 856 
and employer responsibilities for such worksite employees, including 857 
hiring, firing and disciplining, are allocated between the professional 858 
employer organization and the service recipient. 859 
(32) "Professional employer organization" means any person that 860 
enters into a professional employer agreement with a service recipient 861 
whereby the professional employer organization agrees to provide at 862 
least seventy-five per cent of the employees at the service recipient's 863 
worksite. 864 
(33) "Worksite employee" means an employee, the employer 865 
responsibilities for which, including hiring, firing and disciplining, are 866 
allocated, under a professional employer agreement, between a 867 
professional employer organization and a service recipient. 868 
(34) "Prepaid telephone calling service" means the right to exclusively 869 
purchase telecommunications service, that must be paid for in advance 870 
and that enables the origination of calls using an access number or 871 
authorization code, or both, whether manually or electronically dialed, 872 
provided the remaining amount of units of service that have been 873 
prepaid shall be known on a continuous basis. 874 
(35) "Canned or prewritten software" means all software, other than 875 
custom software, that is held or existing for general or repeated sale, 876 
license or lease. Software initially developed as custom software for in-877 
house use and subsequently sold, licensed or leased to unrelated third 878 
parties shall be considered canned or prewritten software. 879 
(36) "Custom software" means a computer program prepared to the 880 
special order of a single customer. 881 
(37) "Services" for purposes of subdivision (2) of this subsection, 882 
means: 883 
(A) Computer and data processing services, including, but not 884  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	29 of 54 
 
limited to, time, programming, code writing, modification of existing 885 
programs, feasibility studies and installation and implementation of 886 
software programs and systems even where such services are rendered 887 
in connection with the development, creation or production of canned 888 
or custom software or the license of custom software, but excluding 889 
digital goods; 890 
(B) Credit information and reporting services; 891 
(C) Services by employment agencies and agencies providing 892 
personnel services; 893 
(D) Private investigation, protection, patrol work, watchman and 894 
armored car services, exclusive of (i) services of off-duty police officers 895 
and off-duty firefighters, and (ii) coin and currency services provided to 896 
a financial services company by or through another financial services 897 
company. For purposes of this subparagraph, "financial services 898 
company" has the same meaning as provided under subparagraphs (A) 899 
to (H), inclusive, of subdivision (6) of subsection (a) of section 12-218b; 900 
(E) Painting and lettering services; 901 
(F) Photographic studio services; 902 
(G) Telephone answering services; 903 
(H) Stenographic services; 904 
(I) Services to industrial, commercial or income-producing real 905 
property, including, but not limited to, such services as management, 906 
electrical, plumbing, painting and carpentry, provided income-907 
producing property shall not include property used exclusively for 908 
residential purposes in which the owner resides and which contains no 909 
more than three dwelling units, or a housing facility for low and 910 
moderate income families and persons owned or operated by a 911 
nonprofit housing organization, as defined in subdivision (29) of section 912 
12-412; 913  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	30 of 54 
 
(J) Business analysis, management, management consulting and 914 
public relations services, excluding (i) any environmental consulting 915 
services, (ii) any training services provided by an institution of higher 916 
education licensed or accredited by the Board of Regents for Higher 917 
Education or Office of Higher Education pursuant to sections 10a-35a 918 
and 10a-34, respectively, and (iii) on and after January 1, 1994, any 919 
business analysis, management, management consulting and public 920 
relations services when such services are rendered in connection with 921 
an aircraft leased or owned by a certificated air carrier or in connection 922 
with an aircraft which has a maximum certificated take-off weight of six 923 
thousand pounds or more; 924 
(K) Services providing "piped-in" music to business or professional 925 
establishments; 926 
(L) Flight instruction and chartering services by a certificated air 927 
carrier on an aircraft, the use of which for such purposes, but for the 928 
provisions of subdivision (4) of section 12-410 and subdivision (12) of 929 
section 12-411, as amended by this act, would be deemed a retail sale 930 
and a taxable storage or use, respectively, of such aircraft by such 931 
carrier; 932 
(M) Motor vehicle repair services, including any type of repair, 933 
painting or replacement related to the body or any of the operating parts 934 
of a motor vehicle; 935 
(N) Motor vehicle parking, excluding space in a parking lot owned or 936 
leased under the terms of a lease of not less than ten years' duration and 937 
operated by an employer for the exclusive use of its employees;  938 
(O) Radio or television repair services; 939 
(P) Furniture reupholstering and repair services; 940 
(Q) Repair services to any electrical or electronic device, including, 941 
but not limited to, equipment used for purposes of refrigeration or air-942 
conditioning; 943  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	31 of 54 
 
(R) Lobbying or consulting services for purposes of representing the 944 
interests of a client in relation to the functions of any governmental 945 
entity or instrumentality; 946 
(S) Services of the agent of any person in relation to the sale of any 947 
item of tangible personal property for such person, exclusive of the 948 
services of a consignee selling works of art, as defined in subsection (b) 949 
of section 12-376c, or articles of clothing or footwear intended to be worn 950 
on or about the human body other than (i) any special clothing or 951 
footwear primarily designed for athletic activity or protective use and 952 
which is not normally worn except when used for the athletic activity or 953 
protective use for which it was designed, and (ii) jewelry, handbags, 954 
luggage, umbrellas, wallets, watches and similar items carried on or 955 
about the human body but not worn on the body, under consignment, 956 
exclusive of services provided by an auctioneer; 957 
(T) Locksmith services; 958 
(U) Advertising or public relations services, including layout, art 959 
direction, graphic design, mechanical preparation or production 960 
supervision, not related to the development of media advertising or 961 
cooperative direct mail advertising; 962 
(V) Landscaping and horticulture services; 963 
(W) Window cleaning services; 964 
(X) Maintenance services; 965 
(Y) Janitorial services; 966 
(Z) Exterminating services; 967 
(AA) Swimming pool cleaning and maintenance services; 968 
(BB) Miscellaneous personal services included in industry group 729 969 
in the Standard Industrial Classification Manual, United States Office of 970 
Management and Budget, 1987 edition, or industry group 532220, 971  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	32 of 54 
 
812191, 812199 or 812990 of the North American Industry Classification 972 
System United States Manual, United States Office of Management and 973 
Budget (NAICS), 1997 edition, exclusive of (i) services rendered by 974 
massage therapists licensed pursuant to chapter 384a, and (ii) services 975 
rendered by an electrologist licensed pursuant to chapter 388; 976 
(CC) Any repair or maintenance service to any item of tangible 977 
personal property including any contract of warranty or service related 978 
to any such item; 979 
(DD) Business analysis, management or managing consulting 980 
services rendered by a general partner, or an affiliate thereof, to a 981 
limited partnership, provided (i) the general partner, or an affiliate 982 
thereof, is compensated for the rendition of such services other than 983 
through a distributive share of partnership profits or an annual 984 
percentage of partnership capital or assets established in the limited 985 
partnership's offering statement, and (ii) the general partner, or an 986 
affiliate thereof, offers such services to others, including any other 987 
partnership. As used in this subparagraph "an affiliate of a general 988 
partner" means an entity which is directly or indirectly owned fifty per 989 
cent or more in common with a general partner; 990 
(EE) Notwithstanding the provisions of section 12-412, except 991 
subdivision (87) of said section 12-412, patient care services, as defined 992 
in subdivision (29) of this subsection by a hospital, except that "sale" and 993 
"selling" does not include such patient care services for which payment 994 
is received by the hospital during the period commencing July 1, 2001, 995 
and ending June 30, 2003; 996 
(FF) Health and athletic club services, exclusive of (i) any such 997 
services provided without any additional charge which are included in 998 
any dues or initiation fees paid to any such club, which dues or fees are 999 
subject to tax under section 12-543, and (ii) any such services provided 1000 
by a municipality or an organization that is described in Section 501(c) 1001 
of the Internal Revenue Code of 1986, or any subsequent corresponding 1002 
internal revenue code of the United States, as amended from time to 1003  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	33 of 54 
 
time; 1004 
(GG) Motor vehicle storage services, including storage of motor 1005 
homes, campers and camp trailers, other than the furnishing of space as 1006 
described in subparagraph (P) of subdivision (2) of this subsection; 1007 
(HH) Packing and crating services, other than those provided in 1008 
connection with the sale of tangible personal property by the retailer of 1009 
such property; 1010 
(II) Motor vehicle towing and road services, other than motor vehicle 1011 
repair services; 1012 
(JJ) Intrastate transportation services provided by livery services, 1013 
including limousines, community cars or vans, with a driver. Intrastate 1014 
transportation services shall not include transportation by taxicab, 1015 
motor bus, ambulance or ambulette, scheduled public transportation, 1016 
nonemergency medical transportation provided under the Medicaid 1017 
program, paratransit services provided by agreement or arrangement 1018 
with the state or any political subdivision of the state, dial-a-ride 1019 
services or services provided in connection with funerals; 1020 
(KK) Pet grooming and pet boarding services, except if such services 1021 
are provided as an integral part of professional veterinary services, and 1022 
pet obedience services; 1023 
(LL) Services in connection with a cosmetic medical procedure. For 1024 
purposes of this subparagraph, "cosmetic medical procedure" means 1025 
any medical procedure performed on an individual that is directed at 1026 
improving the individual's appearance and that does not meaningfully 1027 
promote the proper function of the body or prevent or treat illness or 1028 
disease. "Cosmetic medical procedure" includes, but is not limited to, 1029 
cosmetic surgery, hair transplants, cosmetic injections, cosmetic soft 1030 
tissue fillers, dermabrasion and chemical peel, laser hair removal, laser 1031 
skin resurfacing, laser treatment of leg veins and sclerotherapy. 1032 
"Cosmetic medical procedure" does not include reconstructive surgery. 1033 
"Reconstructive surgery" includes any surgery performed on abnormal 1034  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	34 of 54 
 
structures caused by or related to congenital defects, developmental 1035 
abnormalities, trauma, infection, tumors or disease, including 1036 
procedures to improve function or give a more normal appearance; 1037 
(MM) Manicure services, pedicure services and all other nail services, 1038 
regardless of where performed, including airbrushing, fills, full sets, nail 1039 
sculpting, paraffin treatments and polishes; 1040 
(NN) Spa services, regardless of where performed, including body 1041 
waxing and wraps, peels, scrubs and facials;  1042 
(OO) Car wash services, including coin-operated car washes; 1043 
(PP) Dry cleaning services and laundry services, excluding coin-1044 
operated services; 1045 
(QQ) Interior design services described in industry group 54141 of 1046 
the NAICS, 2017 edition, as amended from time to time. 1047 
(38) "Media payroll services company" means a retailer whose 1048 
principal business activity is the management and payment of 1049 
compensation, fringe benefits, workers' compensation, payroll taxes or 1050 
assessments to individuals providing services to an eligible production 1051 
company pursuant to section 12-217jj. 1052 
(39) "Certified competitive video service" means video programming 1053 
service provided through wireline facilities, a portion of which are 1054 
located in the public right-of-way, without regard to delivery 1055 
technology, including Internet protocol technology. "Certified 1056 
competitive video service" does not include any video programming 1057 
provided by a commercial mobile service provider, as defined in 47 USC 1058 
332(d); any video programming provided as part of community antenna 1059 
television service; any video programming provided as part of, and via, 1060 
a service that enables users to access content, information, electronic 1061 
mail or other services over the Internet. 1062 
(40) "Directory assistance" means an ancillary service of providing 1063 
telephone number information or address information. 1064  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	35 of 54 
 
(41) "Vertical service" means an ancillary service that is offered in 1065 
connection with one or more telecommunications services, offering 1066 
advanced calling features that allow customers to identify callers and to 1067 
manage multiple calls and call connections, including conference 1068 
bridging services. 1069 
(42) "Bed and breakfast establishment" means any private operator-1070 
occupied house, other than a hotel, [or] lodging house or short-term 1071 
rental property, with twelve or fewer rooms in which persons are 1072 
lodged for hire and a full morning meal is included in the rent. 1073 
(43) "Digital goods" means audio works, visual works, audio-visual 1074 
works, reading materials or ring tones, that are electronically accessed 1075 
or transferred. 1076 
(44) "Short-term rental property" means any dwelling unit, other than 1077 
a hotel, lodging house or bed and breakfast establishment, in which a 1078 
guest is lodged for hire, with or without meals, pursuant to a short-term 1079 
rental transaction. For the purposes of this subdivision, "dwelling unit", 1080 
"guest" and "short-term rental transaction" have the same meanings as 1081 
provided in section 1 of this act. 1082 
(b) Wherever in this chapter reference is made to the sale of tangible 1083 
personal property or services, it shall be construed to include sales 1084 
described in subdivision (2) of subsection (a) of this section, except as 1085 
may be specifically provided to the contrary.  1086 
Sec. 9. Section 12-408 of the general statutes is repealed and the 1087 
following is substituted in lieu thereof (Effective July 1, 2021, and 1088 
applicable to sales occurring on or after July 1, 2021): 1089 
(1) (A) For the privilege of making any sales, as defined in 1090 
subdivision (2) of subsection (a) of section 12-407, as amended by this 1091 
act, at retail, in this state for a consideration, a tax is hereby imposed on 1092 
all retailers at the rate of six and thirty-five-hundredths per cent of the 1093 
gross receipts of any retailer from the sale of all tangible personal 1094 
property sold at retail or from the rendering of any services constituting 1095  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	36 of 54 
 
a sale in accordance with subdivision (2) of subsection (a) of section 12-1096 
407, as amended by this act, except, in lieu of said rate, the rates 1097 
provided in subparagraphs (B) to (I), inclusive, of this subdivision; 1098 
(B) (i) At a rate of fifteen per cent with respect to each transfer of 1099 
occupancy, from the total amount of rent received by a hotel or lodging 1100 
house for the first period not exceeding thirty consecutive calendar 1101 
days; 1102 
(ii) At a rate of eleven per cent with respect to each transfer of 1103 
occupancy, from the total amount of rent received by a bed and 1104 
breakfast establishment for the first period not exceeding thirty 1105 
consecutive calendar days; 1106 
(iii) At a rate of five per cent with respect to each transfer of 1107 
occupancy to a guest, as defined in section 1 of this act, from the total 1108 
amount of rent received by a short-term rental operator, as defined in 1109 
section 1 of this act, for the first period not exceeding thirty consecutive 1110 
calendar days; 1111 
(C) With respect to the sale of a motor vehicle to any individual who 1112 
is a member of the armed forces of the United States and is on full-time 1113 
active duty in Connecticut and who is considered, under 50 App USC 1114 
574, a resident of another state, or to any such individual and the spouse 1115 
thereof, at a rate of four and one-half per cent of the gross receipts of any 1116 
retailer from such sales, provided such retailer requires and maintains a 1117 
declaration by such individual, prescribed as to form by the 1118 
commissioner and bearing notice to the effect that false statements made 1119 
in such declaration are punishable, or other evidence, satisfactory to the 1120 
commissioner, concerning the purchaser's state of residence under 50 1121 
App USC 574; 1122 
(D) (i) With respect to the sales of computer and data processing 1123 
services occurring on or after July 1, 2001, at the rate of one per cent, and 1124 
(ii) with respect to sales of Internet access services, on and after July 1, 1125 
2001, such services shall be exempt from such tax; 1126  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	37 of 54 
 
(E) (i) With respect to the sales of labor that is otherwise taxable under 1127 
subparagraph (C) or (G) of subdivision (2) of subsection (a) of section 1128 
12-407, as amended by this act, on existing vessels and repair or 1129 
maintenance services on vessels occurring on and after July 1, 1999, such 1130 
services shall be exempt from such tax; 1131 
(ii) With respect to the sale of a vessel, a motor for a vessel or a trailer 1132 
used for transporting a vessel, at the rate of two and ninety-nine-1133 
hundredths per cent, except that the sale of a vessel shall be exempt from 1134 
such tax if such vessel is docked in this state for sixty or fewer days in a 1135 
calendar year; 1136 
(iii) With respect to the sale of dyed diesel fuel, as defined in 1137 
subsection (d) of section 12-487, sold by a marine fuel dock exclusively 1138 
for marine purposes, at the rate of two and ninety-nine-hundredths per 1139 
cent; 1140 
(F) With respect to patient care services for which payment is 1141 
received by the hospital on or after July 1, 1999, and prior to July 1, 2001, 1142 
at the rate of five and three-fourths per cent and on and after July 1, 2001, 1143 
such services shall be exempt from such tax; 1144 
(G) With respect to the rental or leasing of a passenger motor vehicle 1145 
for a period of thirty consecutive calendar days or less, at a rate of nine 1146 
and thirty-five-hundredths per cent; 1147 
(H) With respect to the sale of (i) a motor vehicle for a sales price 1148 
exceeding fifty thousand dollars, at a rate of seven and three-fourths per 1149 
cent on the entire sales price, (ii) jewelry, whether real or imitation, for 1150 
a sales price exceeding five thousand dollars, at a rate of seven and 1151 
three-fourths per cent on the entire sales price, and (iii) an article of 1152 
clothing or footwear intended to be worn on or about the human body, 1153 
a handbag, luggage, umbrella, wallet or watch for a sales price 1154 
exceeding one thousand dollars, at a rate of seven and three-fourths per 1155 
cent on the entire sales price. For purposes of this subparagraph, "motor 1156 
vehicle" has the meaning provided in section 14-1, but does not include 1157 
a motor vehicle subject to the provisions of subparagraph (C) of this 1158  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	38 of 54 
 
subdivision, a motor vehicle having a gross vehicle weight rating over 1159 
twelve thousand five hundred pounds, or a motor vehicle having a 1160 
gross vehicle weight rating of twelve thousand five hundred pounds or 1161 
less that is not used for private passenger purposes, but is designed or 1162 
used to transport merchandise, freight or persons in connection with 1163 
any business enterprise and issued a commercial registration or more 1164 
specific type of registration by the Department of Motor Vehicles; 1165 
(I) With respect to the sale of meals, as defined in subdivision (13) of 1166 
section 12-412, sold by an eating establishment, caterer or grocery store; 1167 
and spirituous, malt or vinous liquors, soft drinks, sodas or beverages 1168 
such as are ordinarily dispensed at bars and soda fountains, or in 1169 
connection therewith; in addition to the tax imposed under 1170 
subparagraph (A) of this subdivision, at the rate of one per cent; 1171 
(J) The rate of tax imposed by this chapter shall be applicable to all 1172 
retail sales upon the effective date of such rate, except that a new rate 1173 
that represents an increase in the rate applicable to the sale shall not 1174 
apply to any sales transaction wherein a binding sales contract without 1175 
an escalator clause has been entered into prior to the effective date of the 1176 
new rate and delivery is made within ninety days after the effective date 1177 
of the new rate. For the purposes of payment of the tax imposed under 1178 
this section, any retailer of services taxable under subdivision (37) of 1179 
subsection (a) of section 12-407, as amended by this act, who computes 1180 
taxable income, for purposes of taxation under the Internal Revenue 1181 
Code of 1986, or any subsequent corresponding internal revenue code 1182 
of the United States, as amended from time to time, on an accounting 1183 
basis that recognizes only cash or other valuable consideration actually 1184 
received as income and who is liable for such tax only due to the 1185 
rendering of such services may make payments related to such tax for 1186 
the period during which such income is received, without penalty or 1187 
interest, without regard to when such service is rendered; 1188 
(K) (i) For calendar quarters ending on or after September 30, 2019, 1189 
the commissioner shall deposit into the regional planning incentive 1190 
account, established pursuant to section 4-66k, six and seven-tenths per 1191  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	39 of 54 
 
cent of the amounts received by the state from the tax imposed under 1192 
[subparagraph (B)] subparagraphs (B)(i) and (B)(ii) of this subdivision 1193 
and ten and seven-tenths per cent of the amounts received by the state 1194 
from the tax imposed under subparagraph (G) of this subdivision; 1195 
(ii) For calendar quarters ending on or after September 30, 2018, the 1196 
commissioner shall deposit into the Tourism Fund established under 1197 
section 10-395b ten per cent of the amounts received by the state from 1198 
the tax imposed under [subparagraph (B)] subparagraphs (B)(i) and 1199 
(B)(ii) of this subdivision; 1200 
(L) For calendar months commencing on or after July 1, 2021, the 1201 
commissioner shall deposit into the municipal revenue sharing account 1202 
established pursuant to section 4-66l seven and nine-tenths per cent of 1203 
the amounts received by the state from the tax imposed under 1204 
subparagraph (A) of this subdivision; and 1205 
(M) (i) For calendar months commencing on or after July 1, 2017, the 1206 
commissioner shall deposit into the Special Transportation Fund 1207 
established under section 13b-68 seven and nine-tenths per cent of the 1208 
amounts received by the state from the tax imposed under 1209 
subparagraph (A) of this subdivision; 1210 
(ii) For calendar months commencing on or after July 1, 2018, but 1211 
prior to July 1, 2019, the commissioner shall deposit into the Special 1212 
Transportation Fund established under section 13b-68 eight per cent of 1213 
the amounts received by the state from the tax imposed under 1214 
subparagraphs (A) and (H) of this subdivision on the sale of a motor 1215 
vehicle; 1216 
(iii) For calendar months commencing on or after July 1, 2019, but 1217 
prior to July 1, 2020, the commissioner shall deposit into the Special 1218 
Transportation Fund established under section 13b-68 seventeen per 1219 
cent of the amounts received by the state from the tax imposed under 1220 
subparagraphs (A) and (H) of this subdivision on the sale of a motor 1221 
vehicle;  1222  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	40 of 54 
 
(iv) For calendar months commencing on or after July 1, 2020, but 1223 
prior to July 1, 2021, the commissioner shall deposit into the Special 1224 
Transportation Fund established under section 13b-68 twenty-five per 1225 
cent of the amounts received by the state from the tax imposed under 1226 
subparagraphs (A) and (H) of this subdivision on the sale of a motor 1227 
vehicle; 1228 
(v) For calendar months commencing on or after July 1, 2021, but 1229 
prior to July 1, 2022, the commissioner shall deposit into the Special 1230 
Transportation Fund established under section 13b-68 seventy-five per 1231 
cent of the amounts received by the state from the tax imposed under 1232 
subparagraphs (A) and (H) of this subdivision on the sale of a motor 1233 
vehicle; [and]  1234 
(vi) For calendar months commencing on or after July 1, 2022, the 1235 
commissioner shall deposit into the Special Transportation Fund 1236 
established under section 13b-68 one hundred per cent of the amounts 1237 
received by the state from the tax imposed under subparagraphs (A) 1238 
and (H) of this subdivision on the sale of a motor vehicle; and 1239 
(vii) For calendar months commencing on or after July 1, 2021, the 1240 
commissioner shall deposit into the Housing Trust Fund established 1241 
under section 8-336o fifty per cent of the amounts received by the state 1242 
from the tax imposed under subparagraph (B)(iii) of this subdivision. 1243 
(2) (A) Reimbursement for the tax hereby imposed shall be collected 1244 
by the retailer from the consumer and such tax reimbursement, termed 1245 
"tax" in this and the following subsections, shall be paid by the 1246 
consumer to the retailer and each retailer shall collect from the consumer 1247 
the full amount of the tax imposed by this chapter or an amount equal 1248 
as nearly as possible or practicable to the average equivalent thereof. 1249 
Such tax shall be a debt from the consumer to the retailer, when so 1250 
added to the original sales price, and shall be recoverable at law in the 1251 
same manner as other debts except as provided in section 12-432a. The 1252 
amount of tax reimbursement, when so collected, shall be deemed to be 1253 
a special fund in trust for the state of Connecticut. 1254  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	41 of 54 
 
(B) Whenever such tax, payable by the consumer (i) with respect to a 1255 
charge account or credit sale, is remitted by the retailer to the 1256 
commissioner and such sale as an account receivable is determined to 1257 
be worthless and is actually written off as uncollectible for federal 1258 
income tax purposes, or (ii) to a retailer who computes taxable income, 1259 
for purposes of taxation under the Internal Revenue Code of 1986, or 1260 
any subsequent corresponding internal revenue code of the United 1261 
States, as amended from time to time, on the cash basis method of 1262 
accounting with respect to a sale, is remitted by the retailer to the 1263 
commissioner and such sale as an account receivable is determined to 1264 
be worthless, the amount of such tax remitted may be credited against 1265 
the tax due on the sales tax return filed by the retailer for the monthly 1266 
or quarterly period, whichever is applicable, next following the period 1267 
in which such amount is actually so written off, but in no event shall 1268 
such credit be allowed later than three years following the date such tax 1269 
is remitted, unless the credit relates to a period for which a waiver is 1270 
given pursuant to subsection (g) of section 12-415. The commissioner 1271 
shall, by regulations adopted in accordance with the provisions of 1272 
chapter 54, provide standards for proving any such claim for credit. If 1273 
any payment is made by a consumer with respect to an account, such 1274 
payment shall be applied first toward the sales tax, and if any account 1275 
with respect to which such credit is allowed is thereafter collected by the 1276 
retailer in whole or in part, the amount so collected, up to the amount of 1277 
the sales tax for which the credit was claimed, shall be included in the 1278 
sales tax return covering the period in which such collection occurs. The 1279 
tax applicable in any such case shall be determined in accordance with 1280 
the rate of sales tax in effect at the time of the original sale. 1281 
(C) (i) Any person required to collect tax in accordance with this 1282 
subsection who demonstrates to the satisfaction of the Commissioner of 1283 
Revenue Services by July first of any year that, in any two quarterly 1284 
periods as described in section 12-414, within the most recent four 1285 
consecutive quarterly periods, such person was a materialman as such 1286 
term is used in chapter 847, who has at least fifty per cent of such 1287 
person's sales of building materials to contractors, subcontractors or 1288  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	42 of 54 
 
repairmen for the improvement of real property, and is authorized by 1289 
said chapter to file a mechanic's lien upon such real property and 1290 
improvement shall, with respect to such sales made through the 1291 
quarterly period ending the succeeding June thirtieth, collect tax due on 1292 
such sales, and on sales to such contractors, subcontractors or repairmen 1293 
of services described in subdivision (2) of subsection (a) of section 12-1294 
407, as amended by this act, with respect to such building materials, for 1295 
such purpose and made during such July first through June thirtieth 1296 
period, at the time and to the extent that such person receives the 1297 
receipts from, or consideration for, such sales from such contractors, 1298 
subcontractors or repairmen, provided if such person receives a portion 1299 
of such receipts or consideration, such person shall collect the tax due 1300 
on such portion at the time the portion is received. The taxes imposed 1301 
by this chapter on such receipts and consideration shall be deemed 1302 
imposed, solely for purposes of determining when such person is 1303 
required to collect and pay over such taxes to the commissioner under 1304 
section 12-414, when such person has received payment of such receipts 1305 
or consideration in money, or money's worth, from such contractor, 1306 
subcontractor or repairman. A contractor, subcontractor or repairman 1307 
who purchases building materials or services from such person 1308 
pursuant to this subparagraph shall, at the time such contractor, 1309 
subcontractor or repairman pays any portion of the purchase price, pay 1310 
to the person the tax due on the portion of the purchase price so paid. 1311 
(ii) In the event that a materialman described in this subparagraph 1312 
factors any portion of such materialman's receivables, such materialman 1313 
shall be deemed to have received payment of such receipts or 1314 
consideration in money or money's worth, from the contractor, 1315 
subcontractor or repairman and shall be required to pay over tax on 1316 
such sale with the next return due, with a credit against such tax for any 1317 
tax already paid over with respect to such sale. Any such amount of tax 1318 
paid over shall be on account of the tax required to be collected on the 1319 
sale to which it relates and such materialman may take a credit against 1320 
any tax paid by such contractor, subcontractor or repairman in the 1321 
future on such sale, to ensure that tax paid over with respect to such sale 1322  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	43 of 54 
 
does not exceed the amount of tax imposed on such sale as if the entire 1323 
purchase price had been paid at the time of sale. 1324 
(iii) A materialman described in this subparagraph who has not 1325 
collected the tax due on the full purchase price for a sale described in 1326 
this subparagraph from a contractor, subcontractor or repairman within 1327 
one year from the date of such sale, shall pay over to the commissioner 1328 
the tax due on any balance of such full purchase price with such 1329 
materialman's return for the period which includes the date which is 1330 
one year after the date of such sale. 1331 
(iv) The commissioner may assess additional tax due with respect to 1332 
a sale described in this subparagraph not later than three years from the 1333 
date the tax is required to be paid over to the commissioner pursuant to 1334 
this subparagraph, and in the case of a wilfully false or fraudulent return 1335 
with intent to evade the tax, or where no return has been filed such 1336 
taxpayer shall be subject to the provisions of section 12-428. 1337 
(D) In the case of a sale by a producer or wholesaler of newspapers to 1338 
a vendor who is not otherwise required to obtain a permit under this 1339 
chapter, such producer or wholesaler shall collect the sales tax on such 1340 
newspapers at the point of transfer to such vendor. Such tax shall be 1341 
based on the stated retail price of such newspapers. Such vendor may 1342 
add an amount to the price of the newspapers equal to the amount paid 1343 
as sales tax to the producer or wholesaler and such vendor shall not be 1344 
required to remit such amount to the state. 1345 
(3) For the purpose of adding and collecting the tax imposed by this 1346 
chapter, or an amount equal as nearly as possible or practicable to the 1347 
average equivalent thereof, by the retailer from the consumer the 1348 
following bracket system shall be in force and effect as follows: 1349 
 
T1  Amount of Sale 	Amount of Tax 
T2  $0.00 to $0.07 inclusive 	No Tax 
T3  .08 to     .23 inclusive 	1 cent  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	44 of 54 
 
T4  .24 to     .39 inclusive 	2 cents 
T5  .40 to     .55 inclusive 	3 cents 
T6  .56 to     .70 inclusive 	4 cents 
T7  .71 to     .86 inclusive 	5 cents 
T8  .87 to   1.02 inclusive 	6 cents 
T9  1.03 to   1.18 inclusive 	7 cents 
 
On all sales above $1.18, the tax shall be computed at the rate of six 1350 
and thirty-five-hundredths per cent. 1351 
(4) No retailer shall advertise or hold out or state to the public or to 1352 
any consumer, directly or indirectly, that the tax or any part thereof will 1353 
be assumed or absorbed by the retailer or that it will not be added to the 1354 
sales price of the property sold or that, if added, it or any part thereof 1355 
will be refunded. Under the provisions of this section, however, a 1356 
retailer may advertise the sale of tangible personal property by any of 1357 
the following methods: By stating the sales price alone without reference 1358 
to the tax; by stating separately the sales price and the amount of tax to 1359 
be collected thereon; by stating the sales price "plus tax" or "exclusive of 1360 
tax" or by stating a sales price which includes the tax, together with the 1361 
words "tax included" or "tax incl."; provided the retailer in the case of all 1362 
such sales shall maintain his records to show separately the actual price 1363 
of such sales and the amount of the tax paid thereon; and provided such 1364 
retailer, if requested, shall furnish the consumer with a sales slip or other 1365 
like evidence of the sale, showing the tax separately computed thereon. 1366 
Any person violating any provision of this subsection shall be fined five 1367 
hundred dollars for each offense. 1368 
(5) No retailer shall exhibit or display on his premises any notice, sign 1369 
or other advertising matter tending to mislead the public in connection 1370 
with the imposition or collection of the tax. The Commissioner of 1371 
Revenue Services may approve a form of notice for the purpose of 1372 
explaining the operation of the tax. 1373 
(6) The Commissioner of Revenue Services shall adopt regulations, in 1374  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	45 of 54 
 
accordance with chapter 54, establishing a procedure for determination 1375 
of qualifications with respect to the reduced rate of sales tax in the case 1376 
of certain sales of motor vehicles to members of the armed forces as 1377 
provided in subsection (1) of this section. 1378 
(7) For purposes of the tax imposed by this chapter, with respect to 1379 
toll telephone service paid by inserting coins in coin-operated 1380 
telephones, the tax shall be computed to the nearest multiple of five 1381 
cents, except if the tax is midway between multiples of five cents, the 1382 
next higher multiple shall apply.  1383 
Sec. 10. Section 12-411 of the general statutes is repealed and the 1384 
following is substituted in lieu thereof (Effective July 1, 2021, and 1385 
applicable to sales occurring on or after July 1, 2021): 1386 
(1) (A) An excise tax is hereby imposed on the storage, acceptance, 1387 
consumption or any other use in this state of tangible personal property 1388 
purchased from any retailer for storage, acceptance, consumption or any 1389 
other use in this state, the acceptance or receipt of any services 1390 
constituting a sale in accordance with subdivision (2) of subsection (a) 1391 
of section 12-407, as amended by this act, purchased from any retailer 1392 
for consumption or use in this state, or the storage, acceptance, 1393 
consumption or any other use in this state of tangible personal property 1394 
which has been manufactured, fabricated, assembled or processed from 1395 
materials by a person, either within or without this state, for storage, 1396 
acceptance, consumption or any other use by such person in this state, 1397 
to be measured by the sales price of materials, at the rate of six and 1398 
thirty-five-hundredths per cent of the sales price of such property or 1399 
services, except, in lieu of said rate: 1400 
(B) (i) At a rate of fifteen per cent of the rent paid to a hotel or lodging 1401 
house for the first period not exceeding thirty consecutive calendar 1402 
days; 1403 
(ii) At a rate of eleven per cent of the rent paid to a bed and breakfast 1404 
establishment for the first period not exceeding thirty consecutive 1405 
calendar days; 1406  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	46 of 54 
 
(iii) At a rate of five per cent of the rent paid to a short-term rental 1407 
operator, as defined in section 1 of this act, for the first period not 1408 
exceeding thirty consecutive calendar days; 1409 
(C) With respect to the storage, acceptance, consumption or use in 1410 
this state of a motor vehicle purchased from any retailer for storage, 1411 
acceptance, consumption or use in this state by any individual who is a 1412 
member of the armed forces of the United States and is on full-time 1413 
active duty in Connecticut and who is considered, under 50 App USC 1414 
574, a resident of another state, or to any such individual and the spouse 1415 
of such individual at a rate of four and one-half per cent of the sales price 1416 
of such vehicle, provided such retailer requires and maintains a 1417 
declaration by such individual, prescribed as to form by the 1418 
commissioner and bearing notice to the effect that false statements made 1419 
in such declaration are punishable, or other evidence, satisfactory to the 1420 
commissioner, concerning the purchaser's state of residence under 50 1421 
App USC 574; 1422 
(D) (i) With respect to the acceptance or receipt in this state of labor 1423 
that is otherwise taxable under subparagraph (C) or (G) of subdivision 1424 
(2) of subsection (a) of section 12-407, as amended by this act, on existing 1425 
vessels and repair or maintenance services on vessels occurring on and 1426 
after July 1, 1999, such services shall be exempt from such tax; 1427 
(ii) (I) With respect to the storage, acceptance or other use of a vessel 1428 
in this state, at the rate of two and ninety-nine-hundredths per cent, 1429 
except that such storage, acceptance or other use shall be exempt from 1430 
such tax if such vessel is docked in this state for sixty or fewer days in a 1431 
calendar year; 1432 
(II) With respect to the storage, acceptance or other use of a motor for 1433 
a vessel or a trailer used for transporting a vessel in this state, at the rate 1434 
of two and ninety-nine-hundredths per cent; 1435 
(III) With respect to the storage, acceptance or other use of dyed diesel 1436 
fuel, as defined in subsection (d) of section 12-487, exclusively for 1437 
marine purposes, at the rate of two and ninety-nine-hundredths per 1438  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	47 of 54 
 
cent; 1439 
(E) (i) With respect to the acceptance or receipt in this state of 1440 
computer and data processing services purchased from any retailer for 1441 
consumption or use in this state occurring on or after July 1, 2001, at the 1442 
rate of one per cent of such services, and (ii) with respect to the 1443 
acceptance or receipt in this state of Internet access services, on and after 1444 
July 1, 2001, such services shall be exempt from such tax; 1445 
(F) With respect to the acceptance or receipt in this state of patient 1446 
care services purchased from any retailer for consumption or use in this 1447 
state for which payment is received by the hospital on or after July 1, 1448 
1999, and prior to July 1, 2001, at the rate of five and three-fourths per 1449 
cent and on and after July 1, 2001, such services shall be exempt from 1450 
such tax; 1451 
(G) With respect to the rental or leasing of a passenger motor vehicle 1452 
for a period of thirty consecutive calendar days or less, at a rate of nine 1453 
and thirty-five-hundredths per cent; 1454 
(H) With respect to the acceptance or receipt in this state of (i) a motor 1455 
vehicle for a sales price exceeding fifty thousand dollars, at a rate of 1456 
seven and three-fourths per cent on the entire sales price, (ii) jewelry, 1457 
whether real or imitation, for a sales price exceeding five thousand 1458 
dollars, at a rate of seven and three-fourths per cent on the entire sales 1459 
price, and (iii) an article of clothing or footwear intended to be worn on 1460 
or about the human body, a handbag, luggage, umbrella, wallet or 1461 
watch for a sales price exceeding one thousand dollars, at a rate of seven 1462 
and three-fourths per cent on the entire sales price. For purposes of this 1463 
subparagraph, "motor vehicle" has the meaning provided in section 14-1464 
1, but does not include a motor vehicle subject to the provisions of 1465 
subparagraph (C) of this subdivision, a motor vehicle having a gross 1466 
vehicle weight rating over twelve thousand five hundred pounds, or a 1467 
motor vehicle having a gross vehicle weight rating of twelve thousand 1468 
five hundred pounds or less that is not used for private passenger 1469 
purposes, but is designed or used to transport merchandise, freight or 1470  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	48 of 54 
 
persons in connection with any business enterprise and issued a 1471 
commercial registration or more specific type of registration by the 1472 
Department of Motor Vehicles; 1473 
(I) With respect to the acceptance or receipt in this state of meals, as 1474 
defined in subdivision (13) of section 12-412, sold by an eating 1475 
establishment, caterer or grocery store; and spirituous, malt or vinous 1476 
liquors, soft drinks, sodas or beverages such as are ordinarily dispensed 1477 
at bars and soda fountains, or in connection therewith; in addition to the 1478 
tax imposed under subparagraph (A) of this subdivision, at the rate of 1479 
one per cent; 1480 
(J) (i) For calendar quarters ending on or after September 30, 2019, the 1481 
commissioner shall deposit into the regional planning incentive 1482 
account, established pursuant to section 4-66k, six and seven-tenths per 1483 
cent of the amounts received by the state from the tax imposed under 1484 
[subparagraph (B)] subparagraphs (B)(i) and (B)(ii) of this subdivision 1485 
and ten and seven-tenths per cent of the amounts received by the state 1486 
from the tax imposed under subparagraph (G) of this subdivision; 1487 
(ii) For calendar quarters ending on or after September 30, 2018, the 1488 
commissioner shall deposit into the Tourism Fund established under 1489 
section 10-395b ten per cent of the amounts received by the state from 1490 
the tax imposed under [subparagraph (B)] subparagraphs (B)(i) and 1491 
(B)(ii) of this subdivision; 1492 
(K) For calendar months commencing on or after July 1, 2021, the 1493 
commissioner shall deposit into said municipal revenue sharing account 1494 
seven and nine-tenths per cent of the amounts received by the state from 1495 
the tax imposed under subparagraph (A) of this subdivision; and 1496 
(L) (i) For calendar months commencing on or after July 1, 2017, the 1497 
commissioner shall deposit into said Special Transportation Fund seven 1498 
and nine-tenths per cent of the amounts received by the state from the 1499 
tax imposed under subparagraph (A) of this subdivision; 1500 
(ii) For calendar months commencing on or after July 1, 2018, but 1501  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	49 of 54 
 
prior to July 1, 2019, the commissioner shall deposit into the Special 1502 
Transportation Fund established under section 13b-68 eight per cent of 1503 
the amounts received by the state from the tax imposed under 1504 
subparagraphs (A) and (H) of this subdivision on the acceptance or 1505 
receipt in this state of a motor vehicle; 1506 
(iii) For calendar months commencing on or after July 1, 2019, but 1507 
prior to July 1, 2020, the commissioner shall deposit into the Special 1508 
Transportation Fund established under section 13b-68 seventeen per 1509 
cent of the amounts received by the state from the tax imposed under 1510 
subparagraphs (A) and (H) of this subdivision on the acceptance or 1511 
receipt in this state of a motor vehicle; 1512 
(iv) For calendar months commencing on or after July 1, 2020, but 1513 
prior to July 1, 2021, the commissioner shall deposit into the Special 1514 
Transportation Fund established under section 13b-68 twenty-five per 1515 
cent of the amounts received by the state from the tax imposed under 1516 
subparagraphs (A) and (H) of this subdivision on the acceptance or 1517 
receipt in this state of a motor vehicle; 1518 
(v) For calendar months commencing on or after July 1, 2021, but 1519 
prior to July 1, 2022, the commissioner shall deposit into the Special 1520 
Transportation Fund established under section 13b-68 seventy-five per 1521 
cent of the amounts received by the state from the tax imposed under 1522 
subparagraphs (A) and (H) of this subdivision on the acceptance or 1523 
receipt in this state of a motor vehicle; [and]  1524 
(vi) For calendar months commencing on or after July 1, 2022, the 1525 
commissioner shall deposit into the Special Transportation Fund 1526 
established under section 13b-68 one hundred per cent of the amounts 1527 
received by the state from the tax imposed under subparagraphs (A) 1528 
and (H) of this subdivision on the acceptance or receipt in this state of a 1529 
motor vehicle; and 1530 
(vii) For calendar months commencing on or after July 1, 2021, the 1531 
commissioner shall deposit into the Housing Trust Fund established 1532 
under section 8-336o fifty per cent of the amounts received by the state 1533  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	50 of 54 
 
from the tax imposed under subparagraph (B)(iii) of this subdivision. 1534 
(2) Every person storing, accepting, consuming or otherwise using in 1535 
this state services or tangible personal property purchased from a 1536 
retailer for storage, acceptance, consumption or any other use in this 1537 
state and every person storing, accepting, consuming or otherwise using 1538 
in this state tangible personal property which has been manufactured, 1539 
fabricated, assembled or processed from materials purchased from a 1540 
retailer by such person, either within or without this state, for storage, 1541 
acceptance, consumption or any other use by such person in this state is 1542 
liable for the tax. Such person's liability is not extinguished until the tax 1543 
has been paid to this state, except that a receipt from a retailer engaged 1544 
in business in this state or from a retailer who is authorized by the 1545 
commissioner, under such regulations as the commissioner may 1546 
prescribe, to collect the tax and who is, for the purposes of this chapter 1547 
relating to the use tax, regarded as a retailer engaged in business in this 1548 
state, given to the purchaser pursuant to subdivision (3) of this section 1549 
is sufficient to relieve the purchaser from further liability for the tax to 1550 
which the receipt refers. 1551 
(3) Every retailer engaged in business in this state and making sales 1552 
of services or of tangible personal property for storage, acceptance, 1553 
consumption or any other use in this state, not exempted under this 1554 
chapter, shall, at the time of making a sale or, if the storage, acceptance, 1555 
consumption or other use is not then taxable hereunder, at the time the 1556 
storage, acceptance, consumption or use becomes taxable, collect the use 1557 
tax from the purchaser and give to the purchaser a receipt therefor in 1558 
the manner and form prescribed by the commissioner. For the purpose 1559 
of uniformity of tax collection by the retailer the tax brackets set forth in 1560 
subdivision (3) of section 12-408, as amended by this act, pertaining to 1561 
the sales tax shall be employed in the computation of the tax imposed 1562 
by this section. 1563 
(4) The tax required to be collected by the retailer constitutes a debt 1564 
owed to the retailer by the person purchasing tangible personal 1565 
property or services from such retailer. The amount of tax, when so 1566  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	51 of 54 
 
collected, shall be deemed to be a special fund in trust for the state of 1567 
Connecticut. 1568 
(5) The provisions of subdivision (4) of section 12-408, as amended by 1569 
this act, pertaining to the sales tax shall apply with equal force to the use 1570 
tax. 1571 
(6) The tax required to be collected by the retailer from the purchaser 1572 
shall be displayed separately from the list price, the price advertised in 1573 
the premises, the marked price, or other price on the sales check or other 1574 
proof of sales. 1575 
(7) Any person violating the provisions of subdivision (3), (5) or (6) 1576 
of this section shall be fined five hundred dollars for each offense. 1577 
(8) Every retailer selling services or tangible personal property for 1578 
storage, acceptance, consumption or any other use in this state shall 1579 
register with the commissioner and give the name and address of all 1580 
agents operating in this state, the location of all distribution or sales 1581 
houses or offices or other places of business in this state and such other 1582 
information as the commissioner may require. 1583 
(9) For the purpose of the proper administration of this chapter and 1584 
to prevent evasion of the use tax and the duty to collect the use tax, it 1585 
shall be presumed that services or tangible personal property sold by 1586 
any person for delivery in this state is sold for storage, acceptance, 1587 
consumption or other use in this state until the contrary is established. 1588 
The burden of proving the contrary is upon the person who makes the 1589 
sale unless such person takes from the purchaser a certificate to the 1590 
effect that the services or property is purchased for resale. 1591 
(10) The certificate relieves the person selling the services or property 1592 
from the burden of proof only if taken in good faith from a person who 1593 
is engaged in the business of selling services or tangible personal 1594 
property and who holds the permit provided for by section 12-409 and 1595 
who, at the time of purchasing the services or tangible personal 1596 
property, intends to sell it in the regular course of business or is unable 1597  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	52 of 54 
 
to ascertain at the time of purchase whether the service or property will 1598 
be sold or will be used for some other purpose. 1599 
(11) The certificate shall be signed by and bear the name and address 1600 
of the purchaser, shall indicate the number of the permit issued to the 1601 
purchaser and shall indicate the general character of the service or 1602 
tangible personal property sold by the purchaser in the regular course 1603 
of business. The certificate shall be substantially in such form as the 1604 
commissioner may prescribe. 1605 
(12) (A) If a purchaser who gives a certificate makes any storage or 1606 
use of the service or property other than retention, demonstration or 1607 
display while holding it for sale in the regular course of business, the 1608 
storage or use is taxable as of the time the service or property is first so 1609 
stored or used. 1610 
(B) Notwithstanding the provisions of subparagraph (A) of this 1611 
subdivision, any storage or use by a certificated air carrier of an aircraft 1612 
for purposes other than retention, demonstration or display while 1613 
holding it for sale in the regular course of business shall not be deemed 1614 
a taxable storage or use by such carrier as of the time the aircraft is first 1615 
stored or used by such carrier, irrespective of the classification of such 1616 
aircraft on the balance sheet of such carrier for accounting and tax 1617 
purposes. 1618 
(13) It shall be presumed that tangible personal property shipped or 1619 
brought to this state by the purchaser was purchased from a retailer for 1620 
storage, use or other consumption in this state. 1621 
(14) (A) For the purpose of the proper administration of this chapter 1622 
and to prevent evasion of the use tax, a purchase of any service 1623 
described in subdivision (37) of subsection (a) of section 12-407, as 1624 
amended by this act, shall be considered a purchase for resale only if the 1625 
service to be resold is an integral, inseparable component part of a 1626 
service described in said subdivision that is to be subsequently sold by 1627 
the purchaser to an ultimate consumer. The purchaser of the service for 1628 
resale shall maintain, in such form as the commissioner requires, records 1629  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	53 of 54 
 
that substantiate: (i) From whom the service was purchased and to 1630 
whom the service was sold; (ii) the purchase price of the service; and 1631 
(iii) the nature of the service to demonstrate that the service was an 1632 
integral, inseparable component part of a service described in 1633 
subdivision (37) of subsection (a) of section 12-407, as amended by this 1634 
act, that was subsequently sold to a consumer. 1635 
(B) Notwithstanding the provisions of subparagraph (A) of this 1636 
subdivision, no purchase of a service described in subdivision (37) of 1637 
subsection (a) of section 12-407, as amended by this act, by a purchaser 1638 
shall be considered a purchase for resale if such service is to be 1639 
subsequently sold by the purchaser to an ultimate consumer that is 1640 
affiliated with the purchaser in the manner described in subparagraph 1641 
(A) of subdivision (62) of section 12-412. 1642 
(15) For the purpose of the proper administration of this chapter and 1643 
to prevent evasion of the use tax, no purchase of any service by a 1644 
purchaser shall be considered a purchase for resale if such service is to 1645 
be subsequently sold by the purchaser, without change, to an ultimate 1646 
consumer that is affiliated with the purchaser in the manner described 1647 
in subparagraph (A) of subdivision (62) of section 12-412.  1648 
This act shall take effect as follows and shall amend the following 
sections: 
 
Section 1 July 1, 2021 New section 
Sec. 2 July 1, 2021 New section 
Sec. 3 July 1, 2021 New section 
Sec. 4 July 1, 2021 New section 
Sec. 5 July 1, 2021 New section 
Sec. 6 July 1, 2021 New section 
Sec. 7 July 1, 2021 New section 
Sec. 8 July 1, 2021, and 
applicable to sales 
occurring on or after July 
1, 2021 
12-407  Raised Bill No.  1025 
 
 
 
LCO No. 4725   	54 of 54 
 
Sec. 9 July 1, 2021, and 
applicable to sales 
occurring on or after July 
1, 2021 
12-408 
Sec. 10 July 1, 2021, and 
applicable to sales 
occurring on or after July 
1, 2021 
12-411 
 
Statement of Purpose:   
To (1) require that (A) short-term rental properties be licensed by the 
Commissioner of Consumer Protection, (B) short-term rental operators 
notify owners of abutting and adjacent properties regarding use of a 
dwelling unit as a short-term rental property, and (C) short-term rental 
operators maintain minimum insurance coverage and the Insurance 
Commissioner adopt regulations concerning such coverage, (2) permit 
municipalities to tax short-term rental operators, and (3) subject short-
term rental transactions to the sales and use tax. 
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except 
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not 
underlined.]