Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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557.0000 TRANSPORTATION CHARGES—Regulation 1628

Annotation 557.0570

557.0570 Shipment via Warehouse. A firm selling custom furniture orders merchandise for its clients from around the world. The suppliers ship directly to the customers. The firm pays the carrier and bills the customer the actual freight charges separately on the invoice. In the case of merchandise from a foreign country, the goods are picked up at the dock by a regional carrier and taken to a public warehouse in the firm's home city. The warehouse, which also is a common carrier, notifies the firm and its client and then delivers the goods to the customer. The firm never takes possession or handles the property at any point in the movement. The separately stated transportation charges are excluded from the measure of tax. The fact that more than one carrier is used or a public carrier's warehouse is used as a necessary incident to the transportation does not affect the exclusion as long as the goods were not shipped to the firm's warehouse. 4/4/97.