Connecticut’s taxman declared victory Tuesday on behalf of in-state retailers following rejection of an out-of-state book publisher’s appeal of a state Supreme Court ruling ordering it to collect and remit sales tax for books sold in Connecticut.
The state Department of Revenue Services announced that the nation’s High Court refused to hear an appeal from New York-based Scholastic Book Club that it needn’t collect sales tax on books sold by its Connecticut school teachers and others not on its payroll.
DRS Commissioner Kevin B. Sullivan said at issue was tax fairness to thousands of Connecticut retailers who are subject to sales taxes for merchandise and services sold within its borders.
“The department has long believed that the use of schoolteacher representatives by Scholastic provided sufficient nexus within Connecticut to uphold taxability,” said in a statement. “This decision levels the playing field for Connecticut-based retailers who rightly collect and remit the sales tax.”
According to DRS, the Connecticut Supreme decision was based on the fact that about 14,000 Connecticut classroom teachers solicit, process, and deliver book sales to students on behalf of Scholastic, essentially acting as representatives of the company.
DRS said teachers do not receive monetary compensation from Scholastic for their work, but they are the only avenue for students and their families to receive catalogues, submit orders and payments, and collect the delivered items.
A spokeswoman in Scholastic’s New York City office declined immediate comment late Tuesday.
