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CT Ruling 89-56 Sales and Use Taxes 1989-08-18

How did Connecticut Ruling 89-56 treat resale purchases of electricity or steam and gas used to produce utility service?

Short answer: Electricity or steam bought for resale was not taxable if the purchaser gave the seller a resale certificate. Gas used directly to furnish steam or electricity through lines or pipes to consumers was exempt, but the Department would contest the exemption when electricity went to utility retailers rather than consumers. The ruling is superseded.

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This page answers the general question as of 1989. Ezel answers yours, under current Connecticut tax law, with citations.

Currency note: this ruling is from 1989
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This 1989 Connecticut Department of Revenue Services Ruling is not current. The official page says it was superseded by Ruling 2001-3, so it is provided only as historical reference and should not be used as current authority. It addressed specified electricity, steam, gas, resale, and utility transactions under the law then in effect. Connecticut imposes sales and use tax solely at the state level: there are no local or municipal sales taxes. This summary is informational only and is not legal or tax advice. Consult a licensed Connecticut tax professional about current utility-tax treatment.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page as a PDF) is the authoritative source for any reliance.
View original ruling (PDF)

Plain-English summary

A sale of electricity or steam for resale was not subject to sales and use tax under this ruling, although a retail sale could be taxable. The purchaser had to give the seller a resale certificate.

The ruling also said gas bought for direct use in furnishing steam or electricity through lines or pipes to consumers was exempt. The Department warned, however, that it would contest that exemption when the electricity was delivered to public utilities that were retailers of electricity rather than consumers.

The official archive says this ruling was superseded by Ruling 2001-3.

What this means for you

The historical ruling distinguished a documented resale from a retail sale and distinguished delivery to consumers from delivery to utility retailers. Because it is superseded, it does not establish current treatment.

Common questions

Was electricity or steam bought for resale taxable? No, under this ruling.

What documentation was required? The purchaser had to issue a resale certificate to the seller.

Was gas used to furnish electricity or steam exempt? Yes when used directly to furnish service through lines or pipes to consumers, but the Department said it would contest the exemption when the electricity was delivered to utility retailers.

Citations and references

  • Conn. Gen. Stat. §§ 12-412(3), 12-410, and 12-411, as cited in the ruling.

Source

Original ruling text

Ruling 89-56, Electricity/Manufacturing - Utilities/Steam

This information is not current and is being provided for reference purposes only

Ruling 89-56

Electricity - Manufacturing Utilities - Steam

This Ruling has been superseded by   Ruling 2001-3

While a retail sale of electricity or steam may, under certain circumstances, be subject to sales and use taxes, a sale for resale of electricity or steam is not subject to sales and use taxes. See Conn. Gen. Stat. §§ 12-412(3), 12-410 and 12-411. If a sale for resale occurs, the purchaser must issue a resale certificate to the seller.

Purchases of gas for use directly in furnishing steam or electricity delivered to consumers through lines or pipes are exempt from sales and use taxes; Conn. Gen. Stat. §12-412(3); but the applicability of this exemption where electricity is delivered not to consumers, but, instead, to public utilities which are retailers--and not consumers--of electricity, would be contested by this Department.

LEGAL DIVISION

August 18, 1989

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