There is a 3% rental tax (which is taxable), a $1 per day state tourism tariff, and a 9.35% sales tax.
The 9.35% sales tax does go into the states' general fund. Although car rental companies have frowned upon and fought against, the tax increase was enforced by the legislation.
Why Is There a Tax?
Many of the vehicles rented in Connecticut are not registered in Connecticut. This means that the state loses out on the registration and property tax revenue that would otherwise be received. Why are a lot of rentals not registered in Connecticut? It's cheaper to register them elsewhere. In the case of a truck, the state of Connecticut charges registration based on the weight of the vehicle. So if you had a rental truck that would cost $300 per year to register and $1,000 annually in property tax, you could register it in another state where the registration is as little as $30 per year with no property tax.
The state intends to make up for some of this loss with the 3% rental tax on rentals of 30 days or less. Local companies that support the Connecticut registration fees receive significant tax deductibles. Contact us
today to learn more about auto facts.
You Can Support Locally Owned and Operated Stores
Day tourism tariff is on rentals of 30 days or less. The collection goes toward tourism advertising in Connecticut but not into the general state fund.
Whether you are a local resident of Connecticut or an out-of-state visitor, we are sure you will happily support the beauty of tourism.
An Easy Way to Understand Rental Taxes
A sample computation on a 4-day rental bill of $100 would show as follows:
$3 rental tax
$4 tourism tariff
$9.64 sales tax (9.35% of $103)
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