Sec. 12-410. Presumptions and resale certificates.
Sec. 12-410. Presumptions and resale certificates. (1) Presumption of taxability; resale certificate. For the purpose of the proper administration of this chapter and
to prevent evasion of the sales tax it shall be presumed that all receipts are gross receipts
that are subject to the tax until the contrary is established. The burden of proving that
a sale of tangible personal property or service constituting a sale in accordance with
subdivision (2) of subsection (a) of section 12-407 is not a sale at retail is upon the
person who makes the sale unless such person takes in good faith from the purchaser a
certificate to the effect that the property or service is purchased for resale.
(2) Effect of certificate. The certificate relieves the seller from the burden of proof
only if taken in good faith from a person who is engaged in the business of selling
tangible personal property or services constituting a sale in accordance with subdivision
(2) of subsection (a) of section 12-407 and who holds the permit provided for in section
12-409 and who, at the time of purchasing the tangible personal property or service:
(A) Intends to sell it in the regular course of business; (B) intends to utilize such personal
property in the delivery of landscaping or horticulture services, provided the total sale
price of all such landscaping and horticulture services are taxable under this chapter;
or (C) is unable to ascertain at the time of purchase whether the property or service will be
sold or will be used for some other purpose. The burden of establishing that a certificate is
taken in good faith is on the seller. A certificate to the effect that property or service is
purchased for resale taken from the purchaser by the seller shall be deemed to be taken
in good faith if the tangible personal property or service purchased is similar to or of
the same general character as property or service which the seller could reasonably
assume would be sold by the purchaser in the regular course of business.
(3) Form of certificate. The certificate shall be signed by and bear the name and
address of the purchaser, shall indicate the number of the permit issued to the purchaser
and shall indicate the general character of the tangible personal property or service sold
by the purchaser in the regular course of business. The certificate shall be substantially
in such form as the commissioner prescribes.
(4) Liability of purchaser. (A) If a purchaser who gives a certificate makes any use
of the service or property other than retention, demonstration or display while holding it
for sale in the regular course of business, the use shall be deemed a retail sale by the
purchaser as of the time the service or property is first used by the purchaser, and the
cost of the service or property to the purchaser shall be deemed the gross receipts from
such retail sale.
(B) Notwithstanding the provisions of subparagraph (A) of this subdivision, any
use by a certificated air carrier of an aircraft for purposes other than retention, demonstration or display while holding it for sale in the regular course of business shall not be
deemed a retail sale by such carrier as of the time the aircraft is first used by such carrier,
irrespective of the classification of such aircraft on the balance sheet of such carrier for
accounting and tax purposes.
(5) Conditions under which a sale of service shall be considered a sale for resale.
Exception. (A) For the purpose of the proper administration of this chapter and to
prevent evasion of the sales tax, a sale of any service described in subparagraph (I) of
subdivision (2) of subsection (a) of section 12-407 shall be considered a sale for resale
only if the service to be resold is an integral, inseparable component part of a service
described in said subparagraph (I) which is to be subsequently sold by the purchaser to
an ultimate consumer. The purchaser of the service for resale shall maintain, in such
form as the commissioner requires, records which substantiate: (i) From whom the
service was purchased and to whom the service was sold, (ii) the purchase price of the
service, and (iii) the nature of the service to demonstrate that the services were an integral, inseparable component part of a service described in subparagraph (I) of subdivision (2) of subsection (a) of section 12-407 which was subsequently sold to a consumer.
(B) Notwithstanding the provisions of subparagraph (A) of this subdivision, no sale
of a service described in subparagraph (I) of subdivision (2) of subsection (a) of section
12-407 by a seller shall be considered a sale for resale if such service is to be subsequently
sold by the purchaser to an ultimate consumer that is affiliated with the purchaser in the
manner described in subparagraph (A) of subdivision (62) of subsection (a) of section
12-412.
(6) Sales to certain affiliates. For the purpose of the proper administration of this
chapter and to prevent evasion of the sales tax, no sale of any service by a seller shall
be considered a sale for resale if such service is to be subsequently sold by the purchaser,
without change, to an ultimate consumer that is affiliated with the purchaser in the
manner described in subparagraph (A) of subdivision (62) of subsection (a) of section
12-412.
(1949 Rev., S. 2094; P.A. 75-213, S. 24, 25, 53; P.A. 85-240, S. 3, 6; P.A. 88-6, S. 3; P.A. 90-148, S. 22, 34; June Sp.
Sess. P.A. 91-3, S. 112, 168; May Sp. Sess. P.A. 92-17, S. 45, 59; P.A. 93-74, S. 64, 67; P.A. 94-21, S. 1, 2; P.A. 95-359,
S. 10, 19; P.A. 97-243, S. 18, 67; P.A. 00-174, S. 5, 83; P.A. 02-103, S. 6; P.A. 03-225, S. 7.)
History: P.A. 75-213 included references to sale of "service" in Subsecs. (1) and (4) and deleted provision in Subsec.
(4) re inclusion of rent charged rather than cost of property to purchaser in gross receipts; P.A. 85-240 amended Subsec.
(4) to provide that aircraft held for sale by a certificated air carrier, if used for purposes other than retention, demonstration
or display, shall not be deemed to have been sold at retail and subject to sales tax; P.A. 88-6 amended Subsec. (4)(b) by
substituting "aircraft" for "airplane" wherever the latter word appears; P.A. 90-148 added Subsec. (5) describing conditions
under which a sale of service shall be considered a sale for resale, effective July 1, 1990, and applicable to sales of service
for resale on or after that date; June Sp. Sess. P.A. 91-3 amended Subsec. (2) to provide a standard for determining when
a certificate to the effect that property is purchased for resale is taken in good faith by the seller; May Sp. Sess. P.A. 92-17 amended Subsec. (2) to include utilization of property in landscaping or horticultural services; P.A. 93-74 added Subsec.
(6) re certificate of use for sales of commercial motor vehicles and motor buses to qualify for exemption from the sales
tax, effective May 19, 1993, and applicable to sales occurring on and after January 1, 1994; P.A. 94-21 eliminated provision
requiring the purchaser of the service for resale to separately state the service being resold and the cost thereof on the
invoice and required the purchaser of the service for resale to maintain appropriate records concerning the service and its
cost, effective May 2, 1994; P.A. 95-359 deleted Subdiv. (6) re exempt purchases under Sec. 12-412(82) and (83), effective
July 13, 1995; P.A. 97-243 amended Subsecs. (1) and (2) to specify that all receipts are presumed to be gross receipts
subject to tax and that burden of establishing that a certificate is taken on good faith is on the seller and to change the term
horticultural to horticulture, effective June 24, 1997, and applicable to sales occurring on or after October 1, 1997; P.A.
00-174 amended Subsecs. (1) to (3), inclusive, to allow use of resale certificates in the case of sales of services, effective
October 1, 2000, and applicable to sales made on or after that date; P.A. 02-103 made technical changes; P.A. 03-225
amended Subdiv. (5) by designating existing provisions as Subpara. (A) and making technical changes therein and added
new Subdivs. (5)(B) and (6) to prohibit the setting up of a separate purchasing company to purchase enumerated services
on resale for a group of affiliates, effective October 1, 2003, and applicable to sales occurring on or after that date.
See note to Sec. 12-407 (3).
Plaintiff procured property for government and any ownership by plaintiff could have endured only for theoretical
instant, held not taxable under this section. 145 C. 176. Cited. 174 C. 51. Cited. 198 C. 413. Cited. 211 C. 246. Cited. 216
C. 17. Cited. 238 C. 571.
Cited. 18 CA 434. Cited. 43 CA 598.
Day book records adequate proof of nature of sale, when. 30 CS 309.
Subsec. (1):
Cited. 183 C. 566. Cited. 216 C. 17. Cited. 231 C. 315.
Cited. 43 CS 253.