The Department of Revenue Services said this week that online electronics retailer NewEgg.com has agreed to collect and remit sales taxes on purchases made by Connecticut consumers.
The agreement, which will take effect July 1, comes after NewEgg turned over three years of Connecticut sales records to DRS, which used them to pursue residents who hadn’t reported or paid use tax on the purchases on their state tax returns.
The Hartford Courant reported in February that Connecticut was the first state to use such an approach.
NewEgg recently sent Connecticut customers an email saying it felt the most efficient path to comply with a 2017 law was to provide past sales data to DRS, but the company expressed regret.
“…we realize now it wasn’t the best way to do right by our customers,” the March 24 email read.
There was confusion after the company told customers it would help them seek a refund for any use taxes paid on DRS notices received on or after March 19. On March 27, the company sent another email walking that back.
“First, if you received an assessment pertaining to purchases made at Newegg between 2014-2016 and haven’t paid the assessment, we have been assured by [DRS] that it does not intend to continue enforcement of any assessments you may have received pertaining to purchases made at Newegg during 2014-2016, even though the department has the right to obtain collection of the sales tax,” the second email said. “Second, if you have paid any such assessment, we have been told that Connecticut will not be issuing a refund nor is the department required to do so, since the tax was owed.”
Scammers tried to capitalize on any confusion, sending fraudulent invoices to Connecticut residents, instructing them to pay taxes to a fake website that purported to be DRS.
As internet retail has grown, DRS has sought ways to collect taxes owed from consumers who shop online.
Airbnb agreed to begin collecting the state’s sales tax in 2016.
In 2013, Amazon agreed to collect the tax, which also led to the construction of a major distribution center in Windsor.
