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Ezel / Tax Rulings / CT
CT Ruling 90-38 Sales and Use Taxes 1990-04-03

Was a new-car package combining VIN window etching with theft insurance subject to Connecticut sales and use tax?

Short answer: Yes. DRS treated the entire charge for the window-etching and theft-insurance package as part of the gross receipts from selling the new motor vehicle. The package remained taxable even when the dealer billed it separately.

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This page answers the general question as of 1990. Ezel answers yours, under current Connecticut tax law, with citations.

Currency note: this ruling is from 1990
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 is an official 1990 Connecticut Department of Revenue Services Ruling addressing one add-on package sold with new motor vehicles under the law and transaction facts then in effect. The published text cites no specific statute and does not identify the requester; later legal changes or materially different package terms can change the result, so another taxpayer should not assume it applies. 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 your specific situation.
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

Automobile dealers sold new vehicles with a package containing two items: physical etching of the vehicle identification number on the vehicle's windows and an insurance policy promising the customer a fixed payment if the car was stolen and not recovered.

DRS ruled that the total package charge was taxable as part of the gross receipts from selling the new motor vehicle. Billing the package separately did not remove it from the taxable vehicle sale.

What this means for you

Under the ruling, a separate invoice line did not turn the dealer's etching-and-insurance package into an independent nontaxable transaction. DRS treated the package price as part of what the customer paid for the new vehicle sale.

Common questions

Was only the window etching taxable? No. DRS included the total charge for both the etching and insurance.

Did separate billing change the result? No. The ruling expressly says the package was taxable even if billed separately.

What did the insurance pay? A flat sum if the vehicle was stolen and not recovered.

Citations and references

  • The published ruling cites no specific statute or regulation.

Source

Original ruling text

Ruling 90-38, Gross Receipts / Motor Vehicles

Ruling 90-38

Gross Receipts / Motor Vehicles

Automobile dealers are selling a package deal which includes the physical etching of the vehicle identification number on the windows of new motor vehicles as well as an insurance policy that will pay the customer a flat sum if the car is stolen and not recovered. You have inquired whether this package is subject to sales tax.

The Department considers the total charge for this etching and insurance package to be part of the gross receipts for the sale of a new motor vehicle (even if billed separately) and therefore subject to the sales and use tax.

LEGAL DIVISION

April 3, 1990

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