Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2013
 

Sales and Use Tax Annotations


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G

295.0000 GROSS RECEIPTS

Annotation 295.0300

(a) GENERAL

295.0300 Guaranteed Profits. As an incentive to new service station operators, an oil company guarantees the monthly profit of the operator by paying him the difference between the guaranteed profit and the actual profit if the actual profit is less than the guaranteed profit. The difference paid by the oil company to the operator is not part of the service station's taxable gross receipts because the payment is neither directly related to the sale of the gasoline nor a consideration for the transfer of title to the gasoline. The payment is more in the nature of a rebate payment than a subsidy because the oil company is the principal vendor of the operator who retails the gasoline. 10/22/69.