Connecticut Seal

General Assembly

Amendment

 

January Session, 2013

LCO No. 8679

   
 

*HB0670408679SRO*

Offered by:

 

SEN. MCKINNEY, 28th Dist.

SEN. FASANO, 34th Dist.

SEN. BOUCHER, 26th Dist.

SEN. CHAPIN, 30th Dist.

SEN. FRANTZ, 36th Dist.

SEN. GUGLIELMO, 35th Dist.

SEN. KANE, 32nd Dist.

SEN. KELLY, 21st Dist.

SEN. KISSEL, 7th Dist.

SEN. LINARES, 33rd Dist.

SEN. MARKLEY, 16th Dist.

SEN. MCLACHLAN, 24th Dist.

SEN. WELCH, 31st Dist.

SEN. WITKOS, 8th Dist.

To: House Bill No. 6704

File No.

Cal. No. 692

(As Amended by House Amendment Schedule "A")

"AN ACT CONCERNING EXPENDITURES AND REVENUE FOR THE BIENNIUM ENDING JUNE 30, 2015. "

After the last section, add the following and renumber sections and internal references accordingly:

"Sec. 501. Section 12-408 of the general statutes is repealed and the following is substituted in lieu thereof (Effective upon enactment of the federal Marketplace Fairness Act of 2013, and completion of any state action necessary to comply with said act):

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

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

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

(D) (i) With respect to the sales of computer and data processing services occurring on or after July 1, 1997, and prior to July 1, 1998, at the rate of five per cent, on or after July 1, 1998, and prior to July 1, 1999, at the rate of four per cent, on or after July 1, 1999, and prior to July 1, 2000, at the rate of three per cent, on or after July 1, 2000, and prior to July 1, 2001, at the rate of two per cent, on or after July 1, 2001, at the rate of one per cent, and (ii) with respect to sales of Internet access services, on and after July 1, 2001, such services shall be exempt from such tax;

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

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

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

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

(I) The rate of tax imposed by this chapter shall be applicable to all retail sales upon the effective date of such rate, except that a new rate which represents an increase in the rate applicable to the sale shall not apply to any sales transaction wherein a binding sales contract without an escalator clause has been entered into prior to the effective date of the new rate and delivery is made within ninety days after the effective date of the new rate. For the purposes of payment of the tax imposed under this section, any retailer of services taxable under subparagraph (I) of subdivision (2) of subsection (a) of section 12-407, who computes taxable income, for purposes of taxation under the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as from time to time amended, on an accounting basis which recognizes only cash or other valuable consideration actually received as income and who is liable for such tax only due to the rendering of such services may make payments related to such tax for the period during which such income is received, without penalty or interest, without regard to when such service is rendered;

(J) For calendar quarters ending on or after September 30, 2011, the commissioner shall deposit into the municipal revenue sharing account, established pursuant to section 4-66l, one and fifty-seven-hundredths per cent of the amounts received by the state from the tax imposed under subparagraph (A) of this subdivision, and one and forty-three-hundredths per cent of the amounts received by the state from the tax imposed under subparagraph (H) of this subdivision; and

(K) For calendar quarters ending on or after September 30, 2011, the commissioner shall deposit into the regional performance incentive account, established pursuant to section 4-66k, six and seven-tenths per cent of the amounts received by the state from the tax imposed under subparagraph (B) of this subdivision and ten and seven-tenths per cent of the amounts received by the state from the tax imposed under subparagraph (G) of this subdivision.

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

(B) Whenever such tax, payable by the consumer (i) with respect to a charge account or credit sale occurring on or after July 1, 1984, is remitted by the retailer to the commissioner and such sale as an account receivable is determined to be worthless and is actually written off as uncollectible for federal income tax purposes, or (ii) to a retailer who computes taxable income, for purposes of taxation under the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as from time to time amended, on the cash basis method of accounting with respect to a sale occurring on or after July 1, 1989, is remitted by the retailer to the commissioner and such sale as an account receivable is determined to be worthless, the amount of such tax remitted may be credited against the tax due on the sales tax return filed by the retailer for the monthly or quarterly period, whichever is applicable, next following the period in which such amount is actually so written off, but in no event shall such credit be allowed later than three years following the date such tax is remitted, unless the credit relates to a period for which a waiver is given pursuant to subsection (g) of section 12-415. The commissioner shall, by regulations adopted in accordance with chapter 54, provide standards for proving any such claim for credit. If any account with respect to which such credit is allowed is thereafter collected by the retailer in whole or in part, the amount so collected shall be included in the sales tax return covering the period in which such collection occurs. The tax applicable in any such case shall be determined in accordance with the rate of sales tax in effect at the time of the original sale.

(C) (i) Any person required to collect tax in accordance with this subsection who demonstrates to the satisfaction of the Commissioner of Revenue Services by July first of any year that, in any two quarterly periods as described in section 12-414, within the most recent four consecutive quarterly periods, such person was a materialman as such term is used in chapter 847, who has at least fifty per cent of such person's sales of building materials to contractors, subcontractors or repairmen for the improvement of real property, and is authorized by said chapter to file a mechanic's lien upon such real property and improvement shall, with respect to such sales made through the quarterly period ending the succeeding June thirtieth, collect tax due on such sales, and on sales to such contractors, subcontractors or repairmen of services described in subdivision (2) of section 12-407 with respect to such building materials, for such purpose and made during such July first through June thirtieth period, at the time and to the extent that such person receives the receipts from, or consideration for, such sales from such contractors, subcontractors or repairmen, provided if such person receives a portion of such receipts or consideration, such person shall collect the tax due on such portion at the time the portion is received. The taxes imposed by this chapter on such receipts and consideration shall be deemed imposed, solely for purposes of determining when such person is required to collect and pay over such taxes to the commissioner under section 12-414, when such person has received payment of such receipts or consideration in money, or money's worth, from such contractor, subcontractor or repairman. A contractor, subcontractor or repairman who purchases building materials or services from such person pursuant to this subparagraph shall, at the time such contractor, subcontractor or repairman pays any portion of the purchase price, pay to the person the tax due on the portion of the purchase price so paid. (ii) In the event that a materialman described in this subparagraph factors any portion of such materialman's receivables, such materialman shall be deemed to have received payment of such receipts or consideration in money or money's worth, from the contractor, subcontractor or repairman and shall be required to pay over tax on such sale with the next return due, with a credit against such tax for any tax already paid over with respect to such sale. Any such amount of tax paid over shall be on account of the tax required to be collected on the sale to which it relates and such materialman may take a credit against any tax paid by such contractor, subcontractor or repairman in the future on such sale, to ensure that tax paid over with respect to such sale does not exceed the amount of tax imposed on such sale as if the entire purchase price had been paid at the time of sale. (iii) A materialman described in this subparagraph who has not collected the tax due on the full purchase price for a sale described in this subparagraph from a contractor, subcontractor or repairman within one year from the date of such sale, shall pay over to the commissioner the tax due on any balance of such full purchase price with such materialman's return for the period which includes the date which is one year after the date of such sale. (iv) The commissioner may assess additional tax due with respect to a sale described in this subparagraph not later than three years from the date the tax is required to be paid over to the commissioner pursuant to this subparagraph, and in the case of a wilfully false or fraudulent return with intent to evade the tax, or where no return has been filed such taxpayer shall be subject to the provisions of section 12-428.

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

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

T1

Amount of Sale

Amount of Tax

T2

$ 0. 00 to $ 0. 07 inclusive

    No Tax

T3

. 08 to . 23 inclusive

    1 cent

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 and thirty-five-hundredths] six per cent.

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

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

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

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

Sec. 502. Subdivision (1) of section 12-411 of the general statutes is repealed and the following is substituted in lieu thereof (Effective upon enactment of the federal Marketplace Fairness Act of 2013, and completion of any state action necessary to comply with said act):

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

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

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

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

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

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

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

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

(I) For calendar quarters ending on or after September 30, 2011, the commissioner shall deposit into the municipal revenue sharing account, established pursuant to section 4-66l, one and fifty-seven-hundredths per cent of the amounts received by the state from the tax imposed under subparagraph (A) of this subdivision, and one and forty-three-hundredths of the amounts received by the state from the tax imposed under subparagraph (H) of this subdivision; and

(J) For calendar quarters ending on or after September 30, 2011, the commissioner shall deposit into the regional performance incentive account, established pursuant to section 4-66k, six and seven-tenths per cent of the amounts received by the state from the tax imposed under subparagraph (B) of this subdivision and ten and seven-tenths per cent of the amounts received by the state from the tax imposed under subparagraph (G) of this subdivision.

Sec. 503. Subsection (c) of section 12-411b of the general statutes is repealed and the following is substituted in lieu thereof (Effective upon enactment of the federal Marketplace Fairness Act of 2013, and completion of any state action necessary to comply with said act):

(c) Any agreement entered into under subsection (a) of this section may provide that the contractor and its affiliates shall collect the use tax only on items that are subject to the [six and thirty-five-hundredths] six per cent rate of tax. "

This act shall take effect as follows and shall amend the following sections:

Sec. 501

upon enactment of the federal Marketplace Fairness Act of 2013, and completion of any state action necessary to comply with said act

12-408

Sec. 502

upon enactment of the federal Marketplace Fairness Act of 2013, and completion of any state action necessary to comply with said act

12-411(1)

Sec. 503

upon enactment of the federal Marketplace Fairness Act of 2013, and completion of any state action necessary to comply with said act

12-411b(c)