95-053
Response September 5, 1995
Request
Utah State Tax Commission
210 North 1950 West
SLC, Utah 84134
Attn: XXXXX
Re: Advisory opinion on XXXXX
Dear XXXXX,
The XXXXX as a licensed contractor under contract with XXXXX a licensed
general contractor to provide and install lockers on a remodeling project owned
by XXXXX.
The owner, XXXXX, has requested XXXXX, the general contractor, to have
the XXXXX, the subcontractor for the supply and installation of the metal
lockers, to allow XXXXX to buy the lockers directly from the locker
manufacturer and thereby eliminate the tax that the XXXXX would normally pay to
the Utah State Tax Commission.
The XXXXX will still be installing the lockers.
The XXXXX people call this a "Z" purchase order.
Is the above scenario legal/O.K. with the tax commission?
Please provide a written opinion in this matter as soon as possible.
Best Regards,
XXXXX
XXXXX
RE: Advisory Opinion - Application of sales tax
to purchases of construction materials or tangible personal property by XXXXX
Dear
XXXXX,
We
have received your request for an advisory opinion regarding items that you will
install as part of a construction project on property owned by XXXXX. We find as follows:
Under
Utah Administrative Rule R865-19S-58, sales of construction materials to
religious or charitable institutions are exempt from sales tax if:
1. the institution makes payment for the
materials directly to the vendor; and
2. establishes that materials purchased were
used in the improvement or repair of
3. real property owned by the institution.
If
XXXXX buys the materials directly from the manufacturer for installation by
XXXXX, the materials may be purchased by XXXXX tax free. XXXXX is not liable for sales tax on these
items.
Please
let us know if we can answer any additional questions.
For
the Commission,
Alice
Shearer
Commissioner