Blumenthal begins probe into sales tax on energy efficient products

Nick Rees Nov. 18, 2009, 3:33pm


HARTFORD, Conn. (Legal Newsline) - Connecticut Attorney General Richard Blumenthal has begun an investigation into consumer complaints that a home improvement chain had charged improper sales tax on certain energy efficiency products exempt from sales tax.

In a letter to the chief executive officer of Lowe's, Blumenthal urged the company to cooperate with his investigation and perform an immediate audit of the company's tax charges on exempt items. Blumenthal is also seeking refunds for consumers improperly charged sales tax.

"Whether intentional or inadvertent, imposing improper sales taxes is illegal and must be stopped," Blumenthal said. "As winter approaches, economic efficiency will compel consumers to buy energy efficiency products.

"Lowe's needs to do its own in-house inspection and repair - identifying improper sales tax and refunding consumers. This sales tax exemption is critical to protect the environment, as well as the economy. Weatherization products can be costly, and the sales tax savings substantial."

State law makes a wide variety of residential weatherization products, including compact fluorescent light bulbs, windows and doors meeting the federal Energy Star standard, caulking, programmable thermostats, and insulation, exempt from Connecticut sales and use tax.

"Consumers should scrutinize their Lowe's bills for improper sales tax charges - and contact my office about them - because this critical exemption was designed to encourage purchases of items that are energy efficient and environmentally friendly," Blumenthal said.

In a similar case, Blumenthal found that home improvement chain Home Depot had collected sales tax on exempt energy conservation products in 2006. Home Depot, in acknowledging the error, attributed it to a computer glitch and agreed to provide customers with refunds.

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