Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2013
 

Sales and Use Tax Annotations


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G

295.0000 GROSS RECEIPTS

Annotation 295.0560

(a) GENERAL

295.0560 Royalty Payments Based on Units Produced. Where the inventor of a log peeling device had a peeler fabricated by a machinery company and sold it to a logger pursuant to a contract under which the logger paid a fixed sum for the peeler plus a royalty based on the number of board feet of lumber peeled, the royalty payments constituted part of the taxable selling price of the peeler. Where the inventor granted permission to a machinery company to fabricate a log peeler and to sell it ex tax for a fixed sum to a leasing company, which leased it to a logging company for a stipulated rental, in addition to which the logging company agreed to pay the inventor a royalty based on the number of board feet of lumber peeled, the royalty payments constituted taxable rental receipts. 11/1/65.