Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2017
Sales and Use Tax Annotations
280.0000 GIFTS, MARKETING AIDS, PREMIUMS AND PRIZES— Regulation 1670
280.0560 "Free" Goods in Exchange for Coupon. A grocer gives a customer a "free" bar of soap in exchange for a coupon issued by the soap manufacturer. This transaction is considered to be a sale, not a gift, because the coupon represents consideration given by the soap manufacturer to the grocer for the sale of the soap. The soap manufacturer reimburses the grocer for the value of the soap given to the customer in exchange for the coupon. The value assigned to the coupon constitutes the consideration upon which the tax is computed. 11/24/69. (Am. 2005–2).