Sales Tax

[robert goodale]

Farrell wrote:

> I sent a piano A out to Ralf for refinishing - he wants to charge me sales
> tax. I sent piano B out for refinishing to Bob and he charges no sales tax.
> I suppose this is a state-specific thing, but can anyone tell me if one
> should pay sales tax for subcontracted services in Florida? What do other
> states require? Who in state government should I ask (that knows)? I always
> thought that you charge tax for a THING and do not charge tax for a SERVICE.
> Ralf says that if I give him my somethingorothercompanyrelated number, he
> will not charge me tax, but that I need to charge my client the tax. What's
> the deal? I hate the business end of any business! Thanks for any input.

I think it would depend on how a business is set up.  In most states there is no
tax on labor or services, only goods.  In other words tuning is a service, there
for no tax.  Selling a customer a new bench, however, is taxable.  On the other
hand rebuilding an action may be an exception.  Replacing the parts is a
service, but the actual parts qualifies as goods.  (As you can see, explaining
the tax code is like trying to train a poodle to fly a 727).  The loop hole is
that if the bill is written out as "Rebuilt action- Noisy & Sons piano,
#654321", then it may be interpreted as a service.  If a technician only does
this kind of work on the side and spends the remainder on tuning, it is likely
he/she could get away with it.  If it is a full time venture, however, then
billing parts separately would be advised be wiser.

So there you go.

Rob Goodale, RPT
Las Vegas, NV