The Connecticut Legislature has adopted more measures to improve tax compliance and reduce the lag between tax collections and remittance. Already, as of January 1, 2017, the Connecticut Department of Revenue Services (DRS) does not renew seller’s licenses to any person or entity with an outstanding return. Now the state is reducing the period during which sales tax permits are valid, and allowing the department more flexibility in imposing more frequent collection requirements.

Sales tax permits to be renewed more frequently

Between July 1, 1985, and October 1, 2003, sales tax permits in Connecticut were valid for two years. Since then, they have been valid for five years. With the enactment of House Bill 7312 (Act 17-147), “Any permit issued on or after October 1, 2017, shall expire biennially on the anniversary date of the issuance of such permit unless renewed in accordance with such procedure and application form as prescribed by the commissioner.”

Enhanced sales tax remittance

The measure also grants flexibility to the DRS “in deciding when to end the requirement that certain taxpayers remit the sales tax.” The commissioner may require any delinquent taxpayer “to remit the tax collected during a weekly period on a weekly basis.” Weekly remittances are in addition to — not in lieu of — monthly or quarterly returns. For additional details, see the text of the bill.

Every state develops its own rules and regulations regarding sales tax permits, and failure to obtain or renew proper permits can lead to penalties, as in New York. Tax automation software helps businesses comply with changing sales and use tax requirements in all states. Learn more.