Connecticut Department of Revenue Services
Return to CT.Gov Home
State of Connecticut Department of Revenue Services
Taxpayer Answer Center
 Frequently Asked Questions 
 
Email DRS
 
 My Mailbox 
  show accessible links  
  Help  
 
 Search by Category View Category Hierarchy
    
  Search Tips 
   
    

   
  Answer ID  
746
  Select a Category  
  Sales and Use Tax
    Luxury Tax

 Printer Friendly Version of This Answer  Print Answer

 Email This Answer  Email Answer
 
  Are dealer discounts and manufacturer rebates included in the sales price of a motor vehicle for purposes of determining whether the 6.35% or the7% tax rate applies?
  Question
  Q: Are dealer discounts and manufacturer rebates included in the sales price of a motor vehicle for purposes of determining whether the 6.35% or the7% tax rate applies?
  Answer
 

A: Manufacturers of motor vehicles frequently offer cash rebates on particular models to purchasers, who then typically assign the rebates to the dealerships in order to reduce the amount the purchasers pay for the vehicles. In addition, motor vehicle dealers may offer their own discounts on vehicles. Although discounts offered by dealers may be excluded from the sales price of a motor vehicle for purposes of determining whether the sales price exceeds $50,000, rebates paid by manufacturers must be included in the sales price when determining whether the sales price exceeds $50,000, even if purchasers assign the rebates to the dealers to reduce the amount the purchasers pay for the vehicles.

(Updated: 2015)

This answer is intended to provide general information concerning a frequently asked question about a current position, policy, or practice associated with the taxes administered by the Connecticut Department of Revenue Services.  It may include an informal interpretation of Connecticut tax law by the Department of Revenue Services (DRS).  However, it is not intended to serve as a legal ruling.

 
 
 
  
 
  Users who viewed this answer have also viewed
 
Back to Search Results
  Back to Search Results  


Home | CT.gov home | Send Feedback

State of Connecticut Disclaimer and Privacy Policy. Copyright © 2002, 2003, 2004 State of Connecticut.