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General Assembly Raised Bill No. 1262
January Session, 2025
LCO No. 3627
Referred to Committee on HOUSING
Introduced by:
(HSG)
AN ACT REDUCING THE SALES AND USE TAXES FOR CERTAIN
GOODS USED IN NEW HOUSING CONSTRUCTION.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Subdivision (1) of section 12-408 of the general statutes is 1
repealed and the following is substituted in lieu thereof (Effective July 1, 2
2025, and applicable to sales occurring on or after July 1, 2025): 3
(1) (A) For the privilege of making any sales, as defined in 4
subdivision (2) of subsection (a) of section 12-407, at retail, in this state 5
for a consideration, a tax is hereby imposed on all retailers at the rate of 6
six and thirty-five-hundredths per cent of the gross receipts of any 7
retailer from the sale of all tangible personal property sold at retail or 8
from the rendering of any services constituting a sale in accordance with 9
subdivision (2) of subsection (a) of section 12-407, except, in lieu of said 10
rate, the rates provided in subparagraphs (B) to [(I)] (J), inclusive, of this 11
subdivision; 12
(B) (i) At a rate of fifteen per cent with respect to each transfer of 13
occupancy, from the total amount of rent received by a hotel or lodging 14
house for the first period not exceeding thirty consecutive calendar 15
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days; 16
(ii) At a rate of eleven per cent with respect to each transfer of 17
occupancy, from the total amount of rent received by a bed and 18
breakfast establishment for the first period not exceeding thirty 19
consecutive calendar days; 20
(C) With respect to the sale of a motor vehicle to any individual who 21
is a member of the armed forces of the United States and is on full-time 22
active duty in Connecticut and who is considered, under 50 App USC 23
574, a resident of another state, or to any such individual and the spouse 24
thereof, at a rate of four and one-half per cent of the gross receipts of any 25
retailer from such sales, provided such retailer requires and maintains a 26
declaration by such individual, prescribed as to form by the 27
commissioner and bearing notice to the effect that false statements made 28
in such declaration are punishable, or other evidence, satisfactory to the 29
commissioner, concerning the purchaser's state of residence under 50 30
App USC 574; 31
(D) (i) With respect to the sales of computer and data processing 32
services occurring on or after July 1, 2001, at the rate of one per cent, and 33
(ii) with respect to sales of Internet access services, on and after July 1, 34
2001, such services shall be exempt from such tax; 35
(E) (i) With respect to the sales of labor that is otherwise taxable under 36
subparagraph (C) or (G) of subdivision (2) of subsection (a) of section 37
12-407 on existing vessels and repair or maintenance services on vessels 38
occurring on and after July 1, 1999, such services shall be exempt from 39
such tax; 40
(ii) With respect to the sale of a vessel, a motor for a vessel or a trailer 41
used for transporting a vessel, at the rate of two and ninety-nine-42
hundredths per cent, except that the sale of a vessel shall be exempt from 43
such tax if such vessel is docked in this state for sixty or fewer days in a 44
calendar year; 45
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(iii) With respect to the sale of dyed diesel fuel, as defined in 46
subsection (d) of section 12-487, sold by a marine fuel dock exclusively 47
for marine purposes, at the rate of two and ninety-nine-hundredths per 48
cent; 49
(F) With respect to patient care services for which payment is 50
received by the hospital on or after July 1, 1999, and prior to July 1, 2001, 51
at the rate of five and three-fourths per cent and on and after July 1, 2001, 52
such services shall be exempt from such tax; 53
(G) With respect to the rental or leasing of a passenger motor vehicle 54
for a period of thirty consecutive calendar days or less, at a rate of nine 55
and thirty-five-hundredths per cent; 56
(H) With respect to the sale of (i) a motor vehicle for a sales price 57
exceeding fifty thousand dollars, at a rate of seven and three-fourths per 58
cent on the entire sales price, (ii) jewelry, whether real or imitation, for 59
a sales price exceeding five thousand dollars, at a rate of seven and 60
three-fourths per cent on the entire sales price, and (iii) an article of 61
clothing or footwear intended to be worn on or about the human body, 62
a handbag, luggage, umbrella, wallet or watch for a sales price 63
exceeding one thousand dollars, at a rate of seven and three-fourths per 64
cent on the entire sales price. For purposes of this subparagraph, "motor 65
vehicle" has the meaning provided in section 14-1, but does not include 66
a motor vehicle subject to the provisions of subparagraph (C) of this 67
subdivision, a motor vehicle having a gross vehicle weight rating over 68
twelve thousand five hundred pounds, or a motor vehicle having a 69
gross vehicle weight rating of twelve thousand five hundred pounds or 70
less that is not used for private passenger purposes, but is designed or 71
used to transport merchandise, freight or persons in connection with 72
any business enterprise and issued a commercial registration or more 73
specific type of registration by the Department of Motor Vehicles; 74
(I) With respect to the sale of meals, as defined in subdivision (13) of 75
section 12-412, sold by an eating establishment, caterer or grocery store; 76
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and spirituous, malt or vinous liquors, soft drinks, sodas or beverages 77
such as are ordinarily dispensed at bars and soda fountains, or in 78
connection therewith; in addition to the tax imposed under 79
subparagraph (A) of this subdivision, at the rate of one per cent; 80
(J) With respect to the sale of tangible personal property purchased 81
for the construction of a new residential development project, at the rate 82
of three per cent, provided such project contains the lesser of twenty per 83
cent of all dwelling units or fifty dwelling units of affordable housing, 84
as defined in section 8-39a, except that the provisions of this 85
subparagraph shall not apply to a project that qualifies for an exemption 86
under section 12-412; 87
[(J)] (K) The rate of tax imposed by this chapter shall be applicable to 88
all retail sales upon the effective date of such rate, except that a new rate 89
that represents an increase in the rate applicable to the sale shall not 90
apply to any sales transaction wherein a binding sales contract without 91
an escalator clause has been entered into prior to the effective date of the 92
new rate and delivery is made within ninety days after the effective date 93
of the new rate. For the purposes of payment of the tax imposed under 94
this section, any retailer of services taxable under subdivision (37) of 95
subsection (a) of section 12-407, who computes taxable income, for 96
purposes of taxation under the Internal Revenue Code of 1986, or any 97
subsequent corresponding internal revenue code of the United States, 98
as amended from time to time, on an accounting basis that recognizes 99
only cash or other valuable consideration actually received as income 100
and who is liable for such tax only due to the rendering of such services 101
may make payments related to such tax for the period during which 102
such income is received, without penalty or interest, without regard to 103
when such service is rendered; 104
[(K)] (L) (i) For calendar quarters ending on or after September 30, 105
2019, the commissioner shall deposit into the regional planning 106
incentive account, established pursuant to section 4-66k, six and seven-107
tenths per cent of the amounts received by the state from the tax 108
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imposed under subparagraph (B) of this subdivision and ten and seven-109
tenths per cent of the amounts received by the state from the tax 110
imposed under subparagraph (G) of this subdivision; 111
(ii) For calendar quarters ending on or after September 30, 2018, the 112
commissioner shall deposit into the Tourism Fund established under 113
section 10-395b ten per cent of the amounts received by the state from 114
the tax imposed under subparagraph (B) of this subdivision; 115
[(L)] (M) (i) For calendar months commencing on or after July 1, 2021, 116
but prior to July 1, 2023, the commissioner shall deposit into the 117
municipal revenue sharing account established pursuant to section 4-66l 118
seven and nine-tenths per cent of the amounts received by the state from 119
the tax imposed under subparagraph (A) of this subdivision, including 120
such amounts received on or after July 1, 2023, attributable to the fiscal 121
year ending June 30, 2023; and 122
(ii) For calendar months commencing on or after July 1, 2023, the 123
commissioner shall deposit into the Municipal Revenue Sharing Fund 124
established pursuant to section 4-66p seven and nine-tenths per cent of 125
the amounts received by the state from the tax imposed under 126
subparagraph (A) of this subdivision; and 127
[(M)] (N) (i) For calendar months commencing on or after July 1, 2017, 128
the commissioner shall deposit into the Special Transportation Fund 129
established under section 13b-68 seven and nine-tenths per cent of the 130
amounts received by the state from the tax imposed under 131
subparagraph (A) of this subdivision; 132
(ii) For calendar months commencing on or after July 1, 2018, but 133
prior to July 1, 2019, the commissioner shall deposit into the Special 134
Transportation Fund established under section 13b-68 eight per cent of 135
the amounts received by the state from the tax imposed under 136
subparagraphs (A) and (H) of this subdivision on the sale of a motor 137
vehicle; 138
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(iii) For calendar months commencing on or after July 1, 2019, but 139
prior to July 1, 2020, the commissioner shall deposit into the Special 140
Transportation Fund established under section 13b-68 seventeen per 141
cent of the amounts received by the state from the tax imposed under 142
subparagraphs (A) and (H) of this subdivision on the sale of a motor 143
vehicle; 144
(iv) For calendar months commencing on or after July 1, 2020, but 145
prior to July 1, 2021, the commissioner shall deposit into the Special 146
Transportation Fund established under section 13b-68 twenty-five per 147
cent of the amounts received by the state from the tax imposed under 148
subparagraphs (A) and (H) of this subdivision on the sale of a motor 149
vehicle; 150
(v) For calendar months commencing on or after July 1, 2021, but 151
prior to July 1, 2022, the commissioner shall deposit into the Special 152
Transportation Fund established under section 13b-68 seventy-five per 153
cent of the amounts received by the state from the tax imposed under 154
subparagraphs (A) and (H) of this subdivision on the sale of a motor 155
vehicle; and 156
(vi) For calendar months commencing on or after July 1, 2022, the 157
commissioner shall deposit into the Special Transportation Fund 158
established under section 13b-68 one hundred per cent of the amounts 159
received by the state from the tax imposed under subparagraphs (A) 160
and (H) of this subdivision on the sale of a motor vehicle. 161
Sec. 2. Subdivision (1) of section 12-411 of the general statutes is 162
repealed and the following is substituted in lieu thereof (Effective July 1, 163
2025, and applicable to sales occurring on or after July 1, 2025): 164
(1) (A) An excise tax is hereby imposed on the storage, acceptance, 165
consumption or any other use in this state of tangible personal property 166
purchased from any retailer for storage, acceptance, consumption or any 167
other use in this state, the acceptance or receipt of any services 168
constituting a sale in accordance with subdivision (2) of subsection (a) 169
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of section 12-407, purchased from any retailer for consumption or use in 170
this state, or the storage, acceptance, consumption or any other use in 171
this state of tangible personal property which has been manufactured, 172
fabricated, assembled or processed from materials by a person, either 173
within or without this state, for storage, acceptance, consumption or any 174
other use by such person in this state, to be measured by the sales price 175
of materials, at the rate of six and thirty-five-hundredths per cent of the 176
sales price of such property or services, except, in lieu of said rate: 177
(B) (i) At a rate of fifteen per cent of the rent paid to a hotel or lodging 178
house for the first period not exceeding thirty consecutive calendar 179
days; 180
(ii) At a rate of eleven per cent of the rent paid to a bed and breakfast 181
establishment for the first period not exceeding thirty consecutive 182
calendar days; 183
(C) With respect to the storage, acceptance, consumption or use in 184
this state of a motor vehicle purchased from any retailer for storage, 185
acceptance, consumption or use in this state by any individual who is a 186
member of the armed forces of the United States and is on full-time 187
active duty in Connecticut and who is considered, under 50 App USC 188
574, a resident of another state, or to any such individual and the spouse 189
of such individual at a rate of four and one-half per cent of the sales price 190
of such vehicle, provided such retailer requires and maintains a 191
declaration by such individual, prescribed as to form by the 192
commissioner and bearing notice to the effect that false statements made 193
in such declaration are punishable, or other evidence, satisfactory to the 194
commissioner, concerning the purchaser's state of residence under 50 195
App USC 574; 196
(D) (i) With respect to the acceptance or receipt in this state of labor 197
that is otherwise taxable under subparagraph (C) or (G) of subdivision 198
(2) of subsection (a) of section 12-407 on existing vessels and repair or 199
maintenance services on vessels occurring on and after July 1, 1999, such 200
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services shall be exempt from such tax; 201
(ii) (I) With respect to the storage, acceptance or other use of a vessel 202
in this state, at the rate of two and ninety-nine-hundredths per cent, 203
except that such storage, acceptance or other use shall be exempt from 204
such tax if such vessel is docked in this state for sixty or fewer days in a 205
calendar year; 206
(II) With respect to the storage, acceptance or other use of a motor for 207
a vessel or a trailer used for transporting a vessel in this state, at the rate 208
of two and ninety-nine-hundredths per cent; 209
(III) With respect to the storage, acceptance or other use of dyed diesel 210
fuel, as defined in subsection (d) of section 12-487, exclusively for 211
marine purposes, at the rate of two and ninety-nine-hundredths per 212
cent; 213
(E) (i) With respect to the acceptance or receipt in this state of 214
computer and data processing services purchased from any retailer for 215
consumption or use in this state occurring on or after July 1, 2001, at the 216
rate of one per cent of such services, and (ii) with respect to the 217
acceptance or receipt in this state of Internet access services, on and after 218
July 1, 2001, such services shall be exempt from such tax; 219
(F) With respect to the acceptance or receipt in this state of patient 220
care services purchased from any retailer for consumption or use in this 221
state for which payment is received by the hospital on or after July 1, 222
1999, and prior to July 1, 2001, at the rate of five and three-fourths per 223
cent and on and after July 1, 2001, such services shall be exempt from 224
such tax; 225
(G) With respect to the rental or leasing of a passenger motor vehicle 226
for a period of thirty consecutive calendar days or less, at a rate of nine 227
and thirty-five-hundredths per cent; 228
(H) With respect to the acceptance or receipt in this state of (i) a motor 229
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vehicle for a sales price exceeding fifty thousand dollars, at a rate of 230
seven and three-fourths per cent on the entire sales price, (ii) jewelry, 231
whether real or imitation, for a sales price exceeding five thousand 232
dollars, at a rate of seven and three-fourths per cent on the entire sales 233
price, and (iii) an article of clothing or footwear intended to be worn on 234
or about the human body, a handbag, luggage, umbrella, wallet or 235
watch for a sales price exceeding one thousand dollars, at a rate of seven 236
and three-fourths per cent on the entire sales price. For purposes of this 237
subparagraph, "motor vehicle" has the meaning provided in section 14-238
1, but does not include a motor vehicle subject to the provisions of 239
subparagraph (C) of this subdivision, a motor vehicle having a gross 240
vehicle weight rating over twelve thousand five hundred pounds, or a 241
motor vehicle having a gross vehicle weight rating of twelve thousand 242
five hundred pounds or less that is not used for private passenger 243
purposes, but is designed or used to transport merchandise, freight or 244
persons in connection with any business enterprise and issued a 245
commercial registration or more specific type of registration by the 246
Department of Motor Vehicles; 247
(I) With respect to the acceptance or receipt in this state of meals, as 248
defined in subdivision (13) of section 12-412, sold by an eating 249
establishment, caterer or grocery store; and spirituous, malt or vinous 250
liquors, soft drinks, sodas or beverages such as are ordinarily dispensed 251
at bars and soda fountains, or in connection therewith; in addition to the 252
tax imposed under subparagraph (A) of this subdivision, at the rate of 253
one per cent; 254
(J) With respect to the storage, use or other consumption of tangible 255
personal property for the construction of a new residential development 256
project at the rate of three per cent, provided such project contains the 257
lesser of twenty per cent of all dwelling units or fifty dwelling units of 258
affordable housing, as defined in section 8-39a, except that the 259
provisions of this subparagraph shall not apply to a project that 260
qualified for an exemption under section 12-412; 261
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[(J)] (K) (i) For calendar quarters ending on or after September 30, 262
2019, the commissioner shall deposit into the regional planning 263
incentive account, established pursuant to section 4-66k, six and seven-264
tenths per cent of the amounts received by the state from the tax 265
imposed under subparagraph (B) of this subdivision and ten and seven-266
tenths per cent of the amounts received by the state from the tax 267
imposed under subparagraph (G) of this subdivision; 268
(ii) For calendar quarters ending on or after September 30, 2018, the 269
commissioner shall deposit into the Tourism Fund established under 270
section 10-395b ten per cent of the amounts received by the state from 271
the tax imposed under subparagraph (B) of this subdivision; 272
[(K)] (L) (i) For calendar months commencing on or after July 1, 2021, 273
but prior to July 1, 2023, the commissioner shall deposit into the 274
municipal revenue sharing account established pursuant to section 4-66l 275
seven and nine-tenths per cent of the amounts received by the state from 276
the tax imposed under subparagraph (A) of this subdivision, including 277
such amounts received on or after July 1, 2023, attributable to the fiscal 278
year ending June 30, 2023; and 279
(ii) For calendar months commencing on or after July 1, 2023, the 280
commissioner shall deposit into the Municipal Revenue Sharing Fund 281
established pursuant to section 4-66p seven and nine-tenths per cent of 282
the amounts received by the state from the tax imposed under 283
subparagraph (A) of this subdivision; and 284
[(L)] (M) (i) For calendar months commencing on or after July 1, 2017, 285
the commissioner shall deposit into said Special Transportation Fund 286
seven and nine-tenths per cent of the amounts received by the state from 287
the tax imposed under subparagraph (A) of this subdivision; 288
(ii) For calendar months commencing on or after July 1, 2018, but 289
prior to July 1, 2019, the commissioner shall deposit into the Special 290
Transportation Fund established under section 13b-68 eight per cent of 291
the amounts received by the state from the tax imposed under 292
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subparagraphs (A) and (H) of this subdivision on the acceptance or 293
receipt in this state of a motor vehicle; 294
(iii) For calendar months commencing on or after July 1, 2019, but 295
prior to July 1, 2020, the commissioner shall deposit into the Special 296
Transportation Fund established under section 13b-68 seventeen per 297
cent of the amounts received by the state from the tax imposed under 298
subparagraphs (A) and (H) of this subdivision on the acceptance or 299
receipt in this state of a motor vehicle; 300
(iv) For calendar months commencing on or after July 1, 2020, but 301
prior to July 1, 2021, the commissioner shall deposit into the Special 302
Transportation Fund established under section 13b-68 twenty-five per 303
cent of the amounts received by the state from the tax imposed under 304
subparagraphs (A) and (H) of this subdivision on the acceptance or 305
receipt in this state of a motor vehicle; 306
(v) For calendar months commencing on or after July 1, 2021, but 307
prior to July 1, 2022, the commissioner shall deposit into the Special 308
Transportation Fund established under section 13b-68 seventy-five per 309
cent of the amounts received by the state from the tax imposed under 310
subparagraphs (A) and (H) of this subdivision on the acceptance or 311
receipt in this state of a motor vehicle; and 312
(vi) For calendar months commencing on or after July 1, 2022, the 313
commissioner shall deposit into the Special Transportation Fund 314
established under section 13b-68 one hundred per cent of the amounts 315
received by the state from the tax imposed under subparagraphs (A) 316
and (H) of this subdivision on the acceptance or receipt in this state of a 317
motor vehicle. 318
Sec. 3. Section 4-66o of the general statutes is repealed and the 319
following is substituted in lieu thereof (Effective July 1, 2025): 320
The Secretary of the Office of Policy and Management may establish 321
receivables for the revenue anticipated pursuant to subparagraph [(K)] 322
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(L) of subdivision (1) of section 12-408, as amended by this act, and 323
section 4-66l. 324
This act shall take effect as follows and shall amend the following
sections:
Section 1 July 1, 2025, and
applicable to sales
occurring on or after July
1, 2025
12-408(1)
Sec. 2 July 1, 2025, and
applicable to sales
occurring on or after July
1, 2025
12-411(1)
Sec. 3 July 1, 2025 4-66o
Statement of Purpose:
To reduce the sales and use taxes for certain tangible personal property
used in new housing construction.
[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.]