SALT Report 2192 – The Missouri Department of Revenue issued a letter ruling regarding the application of sales tax to items that are purchased in a City that is different from the County in which the item will be used. The Taxpayer is building a home and pursuant to his agreement with the builder, the Taxpayer is required to purchase all of the building materials necessary to complete the project.
The Taxpayer requested guidance as to which sales tax rate applies to its purchases of lumber and windows as he is purchasing these from a retailer in a City that has a different tax rate than the County in which the home will be built.
In its response, the Department referred to section 32.087.12(1), RSMo which states, “For the purposes of any local sales tax imposed by an ordinance or order under the local sales tax law, all sales, except the sale of motor vehicles, trailers, boats, and outboard motors, shall be deemed to be consummated at the place of business of the retailer.”
Accordingly, under the terms of section 32.087.12(1), when the Taxpayer purchases lumber and windows from a retailer in a City and has them delivered to the building site in a County the sale is considered consummated in the City and are subject to the City’s sales tax rates.
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