Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2013

Sales and Use Tax Annotations

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190.0000 CONSTRUCTION CONTRACTORS—Regulation 1521

Annotation 190.0445


190.0445 Installation of Railway Signal System and Automatic Speed Control Detectors. A firm has a lump-sum contract to furnish and install signal systems and automatic speed control detectors on an underground railway. The scope of the work involves segregating the track into blocks, providing code generators for power controlling switches, and installing signals, lighting and destination signs at each loading platform. For each rail car, the firm also provides pickup coils and equipment which identify the codes transmitted through the rails in order to control the speed of the cars. In addition, the firm will also provide free-standing peripheral equipment and install the pickup coils and equipment on the rail cars themselves. The property involved is classified for purposes of Regulation 1521 as follows:


(1) Sensing cables


(1) Control Units and Computer Equipment, attached in such a manner that they become an improvement to realty.

Machinery and Equipment:

(1) Free standing equipment attached merely by plug ins

(2) Train carried equipment—If the cars upon which the equipment is installed are used, the labor to install is not taxable. If the cars are new, the installation is part of the fabrication of the cars and is subject to tax.

(3) Cathode ray tubes and keyboards—connected to main computer, but will perform some work independently. Three units operate the plant and four units are used for standard data processing functions.

(4) Matrix printer

(5) Teletype unit

(6) Computer—2 major (3'x5') and 21 remote slaves

(7) Card recorder

(8) Magnetic tape unit

(9) Paper tape punch

(10) Line printer

Items 1 through 10 are plug in units and mobile (on rollers). As such, the measure of tax includes the charge for shop assembly, wiring and testing of these units, prior to installation. 6/4/76.