The Department of Revenue Services (DRS) mailed nearly 1,000 bills this week to Connecticut residents who owe state taxes for unstamped cigarettes purchased over the Internet. The initiative is part of an effort by the agency to ensure taxpayer compliance with state cigarette and use tax laws.
The bills mailed to 928 individuals detail the tax and interest owed for online cigarette purchases made between 2007 and 2008. Consumers who purchase untaxed cigarettes are required to file Form AU-75, Tax Return for Persons in Possession of Unstamped Cigarettes, to pay both the cigarette and use taxes to the state. Those that do not file and pay these taxes will receive a tax bill related to the purchase.
DRS was able to send the bills as a result of information the agency received from businesses that sold Connecticut residents untaxed cigarettes over the Internet. A federal law, the Jenkins Act, requires out-of-state retailers to give state tax departments detailed information about purchases of cigarettes delivered to their state. Online and mail order retailers must provide the tax departments with the names, addresses, brands, and quantity of cigarettes shipped into each state. This information allows states to make certain the appropriate taxes are paid on the purchases.
“Despite any advertisements smokers may have seen, there are no tax-free cigarettes,” Commissioner Nicholson said.
DRS has conducted similar compliance programs in the past and regularly sends letters to newly discovered cigarette websites to advise them of Connecticut’s law against the shipment of untaxed cigarettes to unlicensed individuals in the state, as well as the requirements of the Jenkins Act.
Individuals who receive a notice should contact the Excise Unit Audit Division with any questions or comments at (860) 541-3224.
Visit the DRS web site at www.ct.gov/DRS for information about Connecticut tax issues. Media calls should be directed to the DRS Communications Office at (860) 297-5610.
