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SC – Portable Toilets. Taxable, but 70% exempt. Huh??

Posted by salestax on May 21, 2009

Thank goodness SC recaps the findings at the top of the letter ruling before getting into the details.

This is a letter ruling for a company in SC questioning whether their rentals of Portable Toilets are subect to sales tax.  If you read down through the details of the ruling, you find that SC deems this to be a sale of tangible personal property and that the services included, whether mandatory or not, is incidental to the rental and is also subject to tax. 

Let’s say that you stopped after reading all of that (95%) of the entire letter response.  If this were your business, you’d be all ready to charge sales tax on the whole transaction.  HOWEVER!!!…

If you read the last 3 sentences, you’ll find that Portable Toilet rentals are exempt on 70% of the charge for such rental/service.  So after all of the verbage to identify that the transaction is subject to tax, they throw in at the end, this little-but big-partial exemption for this particular rental/service industry.

And State Governments wonder why taxpayers think the tax laws are confusing.

Where in the world did this little partial exemption originate?  The porta-potty business must have some good lobbyists in South Carolina.

See the revenue ruling for yourself, here.


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