TSSN-20

Special Notice - Sales and Use Tax

This TSSN is cited in Ruling 89-11; obsoleted in part by AN 94(6), obsoleted in part by AN 2000(8)

Effective July 1, 1989, the 7.5% sales and use tax rate will increase to 8%. The 5% rate on repair or replacement parts for machinery used directly in manufacturing or agricultural production will increase to 5.5%. The 2% rate on aviation fuel used for aviation purposes will increase to 2.5%. The 4% rate on sales of motor vehicles to nonresident servicemen who are on full time active duty in Connecticut will increase to 4.5%.

Meals under $2.00 will no longer be exempt on or after July 1, 1989.

Effective July 1, 1989, sales of GAS and ELECTRICITY to agricultural producers and manufacturers are exempt when 75% or more of the gas or electricity is consumed in a metered building or location for agricultural production or manufacturing. Please notify your utility if you qualify for this exemption.

For all other businesses, including agricultural producers and manufactures who do not qualify for the above exemption, the sales tax applies only on electricity charges over $150 per month for each customer. The threshold of $150 does not apply to gas or heating fuel.

The sales tax does not apply to the sale of water or steam.

Sales of HEATING FUEL to agricultural producers and manufacturers are exempt when 75% or more of the heating fuel is consumed in a building or location used for agricultural production or manufacturing. Please notify your heating fuel dealer if you qualify for this exemption.

The sales tax DOES NOT APPLY to the sales of gas, electricity, or heating fuel USED IN ANY RESIDENTIAL DWELLING (i.e. any building whose predominant use is residential).

Effective July 1, 1989, sales and use tax will apply to several new services and the categories of several existing taxable services will expand. Any of the following services which pertain to realty will be taxable when they are rendered to new construction, business property or residential property located in Connecticut. The examples cited herein to describe each taxable service are general guidelines and are not all inclusive.

• Architectural, building engineering and building planning or design services, including interior design and decorating services
• Business Analysis, Management, Consulting and Public Relations Services

Consulting Services include professional or expert advice concerning any aspect of a business operation.

Public Relations include preparing materials to influence the general public or other groups on behalf of clients.

Management services include the furnishing of a wide variety of general or specialized management services.

• Motor Vehicle repairs to trade or business vehicles will include repair services, painting services and body work. Services to motor vehicles used in a trade or business would include:

(A) Invoices billed to a business

(B) Vehicles bearing commercial registration plates

(C) Vehicles bearing passenger or combination plates where the retailer determines from the customer's declaration on the invoice that such vehicle is used in a trade or business

• Radio or Television repair services include repairs to stereo equipment, VCRs, and tape recorders.

• Furniture reupholstering and repair services include furniture restorations and refinishing.

• Repair services to Electrical or Electronic devices, including, but not limited to, Refrigeration or Air Conditioning.

• Health and Athletic Club Services except club and initiation fees which are subject to the 10% dues tax.

Health and Athletic Club dues include health clubs, athletic clubs, physical fitness facilities, weight reducing establishments, health spas and other exercise and physical fitness facilities.

• Land surveying services include surveying and measuring land, the plotting of land and subdivisions, establishing or reestablishing land boundaries and measuring the lengths and directions of bounding lines.
• Lobbying or consulting services include representing the interests of any client or providing professional or expert advice to directly or indirectly influence any official or staff in the legislative or executive branch of government.
• Sales Agent Services for Selling Tangible Personal Property include the services of an auctioneer, antique dealer, literary agent, consignee, art broker and brokers for motor vehicles, boats and airplanes. This includes the services of an agent or broker for authors and other nonperforming artists such as painters or sculptors when related to the sale of tangible personal property.
• Locksmith services include the repair, servicing or installation of locks and locking devices.
• Advertising or Public Relations Services including Layout, Art Direction, Graphic Design, Mechanical Preparation or Production Supervision, not related to the development of Media Advertising. Advertising services include the creation, preparation and placement of advertisements except as related to radio, television, newspapers or periodicals.
• Landscaping and Horticulture services

Landscaping services include landscape planning, landscape architecture and lawn and garden services. The casual and occasional sales of lawn mowing services will not be taxable.

Horticulture services include tree trimming, spraying, arborist services, ornamental tree and bush planting, pruning, removal and surgery.

• Window cleaning services include the cleaning of windows and exterior and interior glass.
• Maintenance services include the upkeep, care or cleaning of buildings and real property on a regular basis such as housewashing, chimney sweeping, carpet cleaning and snow removal (except the casual and occasional sales of snow removal.)
• Janitorial Services include cleaning and maintenance services provided to buildings. However, the direct employment of a maid in a residential home by the resident is not taxable.
• Exterminating services include termite, insect, rodent and other pest control in residential or commercial buildings.
• Swimming Pool Cleaning and Maintenance Services include the cleaning, care and upkeep of swimming pools.
• Repairs or Maintenance Services to Tangible Personal Property except repairs to motor vehicles owned by individuals which are not used in a trade or business.
• Services rendered in the renovation of commercial, industrial or income producing real property are taxable. Services to new construction which are not taxable under Regulation 26 continue to be exempt unless such services are listed herein.

TSSN-20
(NEW 6/89)