Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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460.0000 REIMBURSEMENT FOR SALES TAX—Regulation 1700

Annotation 460.0175

460.0175 Refunds. A taxpayer who is a carpet wholesaler charges and collects sales tax reimbursement on sales of sample sets and store-use merchandise sold to its dealers. If the dealer reaches a certain sales quota in a given year, the taxpayer will refund the amount paid for the samples and store-use items.

In as much as the collection of sales tax reimbursement is a contractual matter rather than a sales tax law provision, the taxpayer may, if he chooses, refund the amount paid which was designated as tax on the subject items. However, the gross receipts from those sales remain taxable and no reduction of taxable sales is allowed because of the refund of the amount paid for the samples, etc., regardless of whether or not the refund includes the sales tax reimbursement paid by the dealer. 6/20/89.