Missouri – Taxability of Safes and Currency Delivery Services

2/21/2013

SALT Report 2173 – The Missouri Department of Revenue issued a letter ruling regarding the taxability of safe deliveries and currency transportation services.  The Taxpayer is an out-of -state business that offers a variety of security services to customers located throughout the United States. In this case the Taxpayer requested guidance as to whether the amount charged for certain services are subject to Missouri sales and use tax.

Specifically, the Taxpayer wanted to know if its “total solution” package was subject to tax. This service is offered for a flat fee and is part of a multi-year lease. The package includes the use of a safe that the Taxpayer purchases from the safe manufacturer and drop-ships to the Missouri customer, as well as armored car services.  If a customer requests the armored car services, the Taxpayer will arrange for an armored car to transport the customer’s currency to a specific location or, the Taxpayer will transport the currency to a bank and deposit the currency according to the customer’s instructions.

In their response the Department referred to section 144.020.(8) RSMo which states: “The amount paid or charged for rental or lease of tangible personal property, provided that if the lessor or renter of any tangible personal property had previously purchased the property under the conditions of sale at retail or leased or rented the property and the tax was paid at the time of purchase, lease or rental, the lessor, sublessor, renter or subrenter shall not apply or collect the tax on the subsequent lease, sublease, rental or subrental receipts from that property.”

Based on the regulation the Department determined that the use of the safe, the armored car service, and the cash management service are not included in the list of enumerated services subject to sales or use tax. Therefore, the Taxpayer’s charges for its “total solution” package are not subject to Missouri sales and use tax.

For Further Information

Missouri Department of Revenue – Letter Ruling LR 7209