Ruling 2000-1

Sales and Use Taxes
Clothing Costing Less Than Fifty Dollars
Safety Apparel

This Ruling is amplified by PS 2000(6)

FACTS:

A company doing business in Connecticut (the "Company") rents garments to businesses. Most of these garments are employee uniforms or similar items worn by the employees of the Company’s customers. Some of the garments, such as coveralls, are worn in place of street clothes. Other garments, such as counter coats, blazers, smocks and items called "lab coats," are worn over the employees’ clothing. A "lab coat" rented by the Company is a style of garment, varying in length, that is similar to a smock or jacket, and may be worn in a variety of work settings. The garments the Company rents, including the "lab coats," primarily serve to identify employees as such or to protect the wearer or the wearer’s clothing from soil or stain.

The Company does not rent any garments that are specially treated to be flame or acid resistant or that contain special protective materials. Most of the garments are made from untreated cotton or cotton/synthetic blends. They are not designed to protect the wearer from bodily harm or injury.

The Company usually provides a supply of garments to its customers at regular intervals of one or two weeks. After the garments are used, the Company picks up the garments and launders them. The rental charge associated with each item of clothing is less than fifty dollars.

ISSUE:

Whether the garments the Company rents, including the items called "lab coats," are exempt from sales and use taxes under Conn. Gen. Stat. §12-412(47) and Conn. Agencies Regs. §12-426-30 as articles of clothing costing less than fifty dollars each.

RULING:

The garments the Company rents, including the items called "lab coats," are exempt from sales and use taxes under Conn. Gen. Stat. §12-412(47) and Conn. Agencies Regs. §12-426-30 as articles of clothing costing less than fifty dollars each. The lab coats the Company rents are employee uniforms or ordinary clothing. They may protect the wearer or the wearer’s clothing from soil or stain, but they are not "protective" clothing within the meaning of the regulation. If the lab coats were designed to protect the employees from bodily harm or injury rather than to function as employee uniforms or ordinary clothing, they would be exempt as safety apparel under Conn. Gen. Stat. §12-412(91), regardless of their cost.

DISCUSSION:

Under Conn. Gen. Stat. §12-412(47), sales of articles of clothing or footwear costing less than fifty dollars are exempt from sales and use taxes. Conn. Gen. Stat. §12-407(2)(j) defines "sale" to include "the leasing or rental of tangible personal property of any kind whatsoever. . . ." Section 12-412(47) applies to the rental, as well as to the outright sale, of clothing, as long as the cost of each item being rented or sold is less than fifty dollars.

However, there are some exclusions from the exemption. Conn. Gen. Stat. §12-412(47) states that "articles of clothing or footwear shall not include (A) any special clothing or footwear primarily designed for athletic activity or protective use. . . ." Conn. Agencies Regs. §12-426-30 further describes and defines the terms used in the statute. Subdivision (e)(2) of the regulation states that exempt articles of clothing "do not include clothing designed for protective use (and not normally worn other than for such protective use) such as goggles, lab coats, potholders, protective aprons, rubber gloves, and safety glasses." However, the same subdivision later states that exempt articles of clothing "do include . . . kitchen aprons . . . painter pants [and] employee uniforms. . . ."

It is apparent from the list of exempt items in the regulation that employee uniforms, aprons and other items intended to be worn over or instead of street clothing are within the ambit of the exemption. But it is also clear that certain "special" items designed for "protective use" are not exempt under this statute. Since some of the exempt items serve to protect clothing or the body from soil, stain, grease and paint, the term "protective use" as it occurs in the exclusion from the exemption must have a more technical meaning.

Evidently, the "protective use" referred to in the regulation, and associated with all the items listed as examples of clothing "designed for protective use"—goggles, lab coats, potholders, protective aprons, rubber gloves and safety glasses—means protection of more than clothing, and protection from more than dirt. Instead, it means protection from bodily harm, such as from burns, chemical or biological contamination, or particles flying into the eyes. This inference is strengthened by the fact that, effective July 1, 1997, the General Assembly created a separate exemption, Conn. Gen. Stat. §12-412(91), for "safety apparel," including "any item of clothing or protective equipment worn by an employee for protection during the course of the employee’s employment." It is not the purpose of this ruling to further define "safety apparel" for purposes of §12-412(91); however, it is reasonable to conclude that most of the items excluded from §12-412(47) and listed in Conn. Agencies Regs. §12-426-30(e)(2) as "designed for protective use" now qualify as "safety apparel" if they are worn during the course of an employee’s employment.

The question of how to classify items of clothing called "lab coats" remains. What happens when a lab coat functions as an employee uniform, or otherwise serves only to protect the wearer or the wearer’s clothing from soil or stain? On the one hand, Conn. Agencies Regs. §12-426-30(e)(2) appears to exclude lab coats from the scope of Conn. Gen. Stat. §12-412(47) altogether. On the other hand, the regulation lists "employee uniforms" as exempt clothing.

As a rule, when an exemption from tax is involved, any ambiguity in a word or phrase must be resolved against the taxpayer and in favor of the taxing authority. See United Illuminating Co. v. Groppo, 220 Conn. 749, 752-53, 601 A.2d 1005 (1992). This principle applies equally to regulations, which, when ratified by the General Assembly, are presumed to be "consistent with the general statutory scheme that the regulation was designed to implement." Texaco Refining & Marketing Co. v. Commissioner, 202 Conn. 583, 600, 522 A.2d 771 (1987). The term "lab coat" is ambiguous, in that it can apply to more than one type of garment. However, simply to resolve this ambiguity by ruling that all lab coats, regardless of their purpose, are protective clothing and therefore are excluded from the exemption does not seem to comport with the legislative intent embodied in the statute and the regulation, particularly where, as in this case, a company markets items called "lab coats" as employee uniforms, which the regulation specifically lists as exempt.

The answer may be found by examining the context in which the term "lab coats" appears in Conn. Agencies Regs. §12-426-30(e)(2).

State v. Roque, 190 Conn. 143, 152, 460 A.2d 26 (1983). (Noscitur a sociis is a Latin phrase meaning "it is known from its associates." Black’s Law Dictionary 956 (5^th ed. 1979).) In the regulation, "lab coats" are listed together with goggles, potholders, protective aprons, rubber gloves and safety glasses. The lab coats excluded by the regulation are, like the other items in this list, designed to protect the human body from harm or injury, not merely to identify the wearer as an employee or to cover or protect the wearer’s clothing.

We conclude that lab coats specially designed to protect the wearer from bodily harm or injury are properly excluded from exemption under Conn. Gen. Stat. §12-412(47), whereas lab coats that function as employee uniforms or ordinary clothing, that are not made of protective fabrics and have no special protective construction or purpose, are exempt if they are sold or rented for less than fifty dollars each. Lab coats that protect the wearer from bodily harm or injury are exempt as "safety apparel" under Conn. Gen. Stat. §12-412(91), even though they are not exempt under §12-412(47).

LEGAL DIVISION

January 27, 2000