Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2014
 

Sales and Use Tax Annotations


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C

190.0000 CONSTRUCTION CONTRACTORS—Regulation 1521

Annotation 190.2839

(e) FIXED-PRICE CONTRACTS

190.2839 Fixed Price Contracts. To qualify for the exemption provided in Sales and Use Tax Law section 6376 for fixed price contracts, a construction contract must be for a specific price, which may not be increased due to an increase in the sales and use tax rate applicable to tangible personal property required to be furnished under the contract.

A cost-plus-a-fixed-fee contract is not for fixed price even if it provides for a guaranteed maximum price.

A cost-plus-a-percentage-fee contract that specifies certain costs that will not be reimbursed but does not preclude the contractor from passing on an increase in sales tax is also not a fixed price contract. 7/26/90.