Ruling 89-2

Exemption - Governmental

Your company is registered to collect use tax. As a retailer making sales of tangible personal property for storage, acceptance, consumption or other use in this state, your company is required to collect use tax from its customers on all such sales other than sales of spice, cookies and popcorn (other than candy-covered or yogurt-covered popcorn). The measure of the tax is the sales price charged by your company to its customers.

Sales to Connecticut municipalities or their agencies are exempt from use tax. The municipality or its agency must be billed directly by your company and must pay your company directly by check drawn on its checking account. The municipality or its agency must also issue a properly completed "Governmental Agency Exemption Certificate" (copy enclosed) to your company at the time of the sale by your company. Sales to high school or elementary school classes are subject to use tax because such classes are not municipal agencies.

All other sales, excluding sales for resale, are subject to use tax. If a sale for resale if involved, the purchaser must issue a properly completed Resale Certificate to your company at the time of the sale by your company.

LEGAL DIVISION

March 2, 1989