Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2014
 

Transactions and Use Tax Annotations

800.0000 APPLICATION OF TRANSACTIONS (SALES) TAX AND USE TAX—Regulation 1823

Annotation 800.0956

800.0956 Sales to Contractor—Installation Site in District. A supplier located in a nontransit district sells materials to contractors who take delivery at the supplier's place of business. The supplier knows that the contractor will consume the materials in a transit district.

If the supplier is "engaged in business" in the transit district in which the materials are consumed by the contractor, the supplier would be obligated to collect the transit district use tax from the contractor when the supplier's local office or representative in the transit district has participated in any way in the sale. "Engaged in business" means and includes one who has an office in the district, or who has agents or representatives operating in the district for the purpose of selling, delivering, or taking orders for tangible personal property.

However, if supplier is not "engaged in business" in the transit district and supplier delivers the property sold to customer at the supplier's factory, the supplier has no obligation to collect transit district use tax even though it knows the customer will use the property in the transit district. 4/28/88.