What is sales tax in Connecticut?
Connecticut has a state sales tax but, unlike many other tax jurisdictions, there are no local taxes in the state. Connecticut’s sales tax rate for 2024 is 6.35%.
However, there are exemptions to Connecticut’s general sales tax rate. These include lower rates on certain kinds of goods or services and higher rates on others.
Lower Connecticut sales tax rates
- 1%: Computer and data processing services.
- 2.99%: Vessels, motors for vessels, trailers used for transporting a vessel, and dyed. diesel fuel sold by a marine dock exclusively for marine purposes.
- 4.5%: Motor vehicle to a nonresident member, or a member and his or her spouse jointly, of the armed forces stationed on full-time active duty in Connecticut.
Higher Connecticut sales tax rates
- 7.35%: Meals and certain beverages.
- 7.75%: Most motor vehicles with a sales price of more than $50,000.
- 7.75%: Items of jewelry, whether real or imitation, with a sales price of more than $5,000.
- 7.75%: Articles of clothing or footwear intended to be worn on or about the human body, or a handbag, luggage, umbrella, wallet, or watch, with a sales price of more than $1,000.
- 9.35%: Rental or leasing of a passenger motor vehicle for a period of 30 consecutive calendar days or less.
See Connecticut’s Sales Tax Rate page for more information about sales tax rates for Connecticut.
What is Connecticut’s food tax rate?
Connecticut is one of the many states that exempt the sale of groceries from sales tax. However, that doesn’t mean that anything you buy at a grocery store is exempt from taxes.
Connecticut’s food tax exemption doesn’t include:
- Prepared meals
- Carbonated beverages
However, the state of Connecticut does exempt food products, including meals and candy sold via coin-operated vending machines and meals delivered to people who are sixty years or older, have physical disabilities, or are homebound for other reasons.
Learn more about Connecticut’s food tax exemption.
What is Connecticut’s restaurant tax rate?
In 2019, Connecticut adopted a 1% tax surcharge on restaurant food or ‘prepared meals’ (also known as the Connecticut prepared food tax). Added to the base state sales tax rate of 6.35%, that makes Connecticut’s prepared food tax rate 7.35%.
Connecticut’s restaurant tax applies to:
- Food and beverages sold for human consumption at the seller’s location
- Food products sold in forms and portions that make them ready for immediate consumption (ex. Prepared food, prepackaged foods, hot foods, ect).
Learn more about the Connecticut restaurant tax, including how to determine what qualifies as ‘prepared food’ and what doesn’t.
What is Connecticut’s clothing tax?
While some states don’t tax clothing or offer exemptions to certain types of items, Connecticut taxes most clothing at the state’s base sales tax rate of 6.35% and add a surcharge on luxury items. The Connecticut clothing tax is a use tax on luxury clothing and accessories that adds up to 7.75%.
Here’s what gets taxed at the Connecticut clothing tax rate:
- Articles of clothing or footwear with a sales price over $1,000
- Handbags, luggages, umbrellas, wallets, or watches with a sales price over $1,000.
However, during the state’s annual Connecticut Sales Tax-Free Week most clothing and footwear under $100 are exempt from sales tax.
Learn more about Connecticut’s clothing tax and the use tax rate.
What counts as taxable items in Connecticut?
In Connecticut, tangible goods are generally taxable. Most items are subject to Connecticut’s sale and use tax.
Here are a few examples of taxable items in Connecticut:
- Tangible personal property, unless specifically exempted
- Prepared food
- Software as a Service (SaaS)
- Digital goods
What are non-taxable items or sales tax exemptions in Connecticut?
Connecticut has a number of sales tax exemptions for goods or services which the state doesn’t charge sales taxes on.
Here are a few examples of non-taxable and exempt items in Connecticut:
- Agricultural products
- Bike helmets
- Breast pumps and breast pump collection supplies
- Child car seats
- United States and Connecticut flags
- Firearm safety devices
- Magazines by subscription
- Some services
- Food for home consumption
- Certain safety gear
- Some protective equipment
- Medical goods and equipment
- College textbooks
Learn more about Connecticut sales tax exemptions.
When do I need to collect sales tax in Connecticut?
As an ecommerce seller, you will need to collect sales tax in Connecticut if you have achieved Connecticut sales tax nexus.
You can achieve CT sales tax nexus in two ways:
Connecticut physical nexus
- You achieve this status by having a physical presence of some kind in Connecticut.
Connecticut economic nexus
- You’re a remote seller that has $100,000 in annual total sales AND
- More than 200 total transactions in the current or previous calendar year
With economic nexus, an ecommerce business can achieve nexus in Connecticut without ever physically having a presence.
What is the physical Connecticut sales tax nexus threshold?
Certain business activities create a physical Connecticut sales tax nexus. If you have physical nexus, you are required to collect and remit sales tax on all taxable sales of goods shipped to Connecticut.
Examples of business activities that can create physical nexus in Connecticut include:
- A physical office or place of business
- An employee or independent contractor present in the state more than two days per year
- Ownership of personal property
- Inventory or goods in a warehouse
- Merchandise delivery in a Connecticut taxpayer’s vehicle
What is the Connecticut economic nexus threshold?
Once you have Connecticut economic nexus established, you will be obligated to collect sales tax from buyers in the state. To have economic nexus in Connecticut, your business meets the following criteria:
- $100,000 or more in gross receipts from sales in the state AND
- 200 or more separate retail transactions in a given year
Gross receipts include wholesale and exempt sales and sales you make through a marketplace facilitator. The measurement period is the 12-month period preceding September 30th.
For example, if you exceed the threshold on July 15, 2024, but had not exceeded the threshold on September 30, 2023, the due date to register and collect tax is October 1, 2024.
How does Connecticut nexus work with marketplaces?
Connecticut nexus tax laws are a bit more complex when it comes to tax collection and marketplaces. Here are a few things you need to understand about marketplace sellers and Connecticut nexus:
- Marketplace facilitators are required to collect and remit sales tax for the companies they sell for regardless of whether they have or are required to have a Connecticut sales and use tax permit.
- Connecticut defines a marketplace facilitator as any person or entity that facilitates retail sales of at least $250,000 during the prior 12-month period in a forum that lists tangible personal property for sale including digital goods.
- Marketplace sellers do not need to have a CT sales tax license for sales facilitated via a marketplace unless they personally have Connecticut nexus. The marketplace is the one who collects and remits tax on their behalf and assumes all tax liability and tax obligations.
Learn more about tax rules for marketplace facilitators and sellers on the Connecticut State Tax Commission website.
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Is there a sales tax holiday in Connecticut?
Connecticut recognizes a week-long sales tax holiday called the Connecticut Sales Tax-Free Week that exempts most clothing and footwear priced below $100 from sales tax.
However, there are some types of clothing and footwear that are taxable even if they’re less than $100. Here are some examples:
- Ski pants
- Roller skates
- Protective aprons
- Wet suits
Connecticut’s Sales Tax-Free Week begins on the third Sunday in August and continues through the following Saturday. In 2024, it will take place August 18-24th.
Learn more about items that are taxable even during Connecticut Sales Tax-Free Week.
Is Connecticut a Streamlined Sales Tax (SST) member?
Currently, Connecticut is not a full or associate member of the Streamlined Sales Tax Governing Board (SSTGB).
How do I register for a sales tax permit in Connecticut?
Once you meet the requirements for either physical or economic nexus in Connecticut, you can register online for a Connecticut sales tax license at the Connecticut Department of Revenue Services’ (DRS) myconneCT online center.
In order to complete your Connecticut sales tax registration, you will need:
- The Federal Employer Identification Number (FEIN) of the business or the Social Security Number (SSN) of the sole proprietor.
- If your business does not have an FEIN (and you are not a sole proprietor), you need to apply for a FEIN with the IRS.
- The legal name of the business or the sole proprietor’s name.
- The business name (DBA), if applicable.
- The business address.
- Banking information to pay permit/license fees (if applicable). Note that the application fees once submitted are not refundable.
The names and Social Security Numbers of any responsible owners and/or officers.
There is a $100 fee for registering for a Connecticut sales and use tax permit.
Sales Tax Guides by State
Our sales tax guides provide an overview of sales tax rates, nexus thresholds, taxable and nontaxable items, along with other valuable tax knowledge for every U.S. state.
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Rhode Island
- South Carolina
- South Dakota
- West Virginia