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SN 97(9)

1997 Legislative Changes Affecting
Licensed Motor Vehicle Lessors

PURPOSE: The purpose of this Special Notice is to describe the legislative changes made during the 1997 session of the Connecticut General Assembly affecting licensed motor vehicle lessors.

STATUTORY AUTHORITY: Conn. Gen. Stat. §12-431, as amended by 1997 Conn. Pub. Acts 243, §31.

EFFECTIVE DATE: October 1, 1997.

LICENSED MOTOR VEHICLE LESSORS REQUIRED TO COLLECT TAX: 1997 Conn. Pub. Acts 243 amends subsection (a) of Conn. Gen. Stat. §12-431 to require a "licensed motor vehicle lessor" to charge and collect sales tax as a retailer when a motor vehicle is sold (as opposed to leased) by the lessor.

Previously, when a licensed motor vehicle lessor sold a vehicle at the end of a lease, it was not required or permitted to collect the tax on the sale. Under Conn. Gen. Stat. §12-431(a), the purchaser was required to pay the use tax directly to the Department of Motor Vehicles before obtaining a registration for the vehicle. As of October 1, 1997, licensed motor vehicle lessors are now required to charge and collect sales tax on such transactions.

A "licensed motor vehicle dealer" is a person licensed pursuant to Conn. Gen. Stat. §14-15.

EFFECT OF THIS DOCUMENT: A Special Notice (SN) is a document that, in response to newly enacted or amended Connecticut or federal laws or in response to newly released judicial decisions, announces a new Department position, policy or practice affecting the tax liability of taxpayers.


FOR FURTHER INFORMATION: If you have questions about Connecticut taxes, please call the Department of Revenue Services during business hours, Monday through Friday:

  • 860-297-5962 (Hartford calling area or from out-of-state): or
  • 1-800-382-9463 (toll-free from within Connecticut).

Telecommunications Device for the Deaf (TDD/TT) users ONLY call 860-297-4911 during business hours.

FORMS AND PUBLICATIONS: You may obtain forms and publications at any hour, seven days a week:

  • Telephone: use the phone numbers listed above and select Option 3 from a touch-tone phone;
  • Internet: preview and download forms from the DRS Web site:

SN 97(9)
Sales and Use Tax
Issued: 12/30/97