This information is not current and is being provided for reference purposes only
Exemption - Governmental
This Ruling has been obsoleted by AN 2000(8)
The Lease and Operating Agreement between the State of Connecticut and Company X [hereinafter, "the Agreement"] has been reviewed by the Legal Division of this Department. I have been advised that the Agreement was a construction contract, as the term is defined in Conn. Agencies Regs. §12-426-18(a), in that it obligated Company X to construct real property.
I have been further advised that Company X and its subcontractor Company Y were contractors, as the term is used in Conn. Agencies Regs. §12-426-18. As such, their purchases of "materials and supplies as are to be physically incorporated in and become a permanent part"; Conn. Agencies Regs. §12-426-18(b); of the hanger being constructed under the Agreement would not have been subject to sales and use taxes. Accordingly, Company X and its subcontractor could have issued Contractor's Exempt Purchase Certificates to vendors of materials and supplies to be physically incorporated in and become a permanent part of the hanger. It is so ruled.
TIMOTHY F. BANNON
July 5, 1989