96-119

Respnse August 12, 1996

Request

Re: Sale Tax on Temporary Scaffolding

Dear Mr./Ms. Commissioner:

I have been requested by my client, XXXXX located in XXXXX, UT, to provide an official document proving they owe sales tax on the services we performed for them on their site. XXXXX’s business is to erect and dismantle scaffolding for the use of construction workers to repair, maintain, construct, etc. At the XXXXX, we erected and dismantled scaffolding for pipe fitters, electricians, painters, fire proofers, the list is endless. The all performed work which went into the final construction of the building. Our services are temporary. Having been audited in the past, we are very aware of the taxability of our services. However, clients such as XXXXX make it difficult on us by electing to self-interpret tax codes.

I am requesting an official position on the taxability of this matter. If you could please respond as soon as possible, they are holding in excess of $200,000.00 of our money pending the resolution.

Please feel free to contact me if you have any questions concerning this matter.

Sincerely,

XXXXX

August 12, 1996

XXXXX

Advisory Opinion - Sales tax on rental and installation of scaffolding

Dear XXXXX

We have received your request for an opinion regarding the application of sales tax to services provided by your company to your customer, XXXXX. In a conversation with a member of our staff, you indicated that your transaction with XXXXX involved the rental of scaffolding. As part of the rental transaction, your company delivered the scaffolding to the work site, assembled it, and removed it at the end of the project. On the basis of these facts, we find as follows:

Charges for the rental of tangible personal property are subject to sales tax under section 59-12-103 of the Utah Code. You have indicated to us that the scaffolding remains free standing once it is assembled. There is no question, then, that this is a taxable rental of tangible personal property (rather than real property).

Under the rental contract, XXXXX apparently agreed to deliver the scaffolding to the job site, assemble it, then remove it at the end of the project. Charges for delivery, set-up and removal are merely part of the taxable rental charge when these services are anticipated by the rental contract. Therefore, the entire amount charged for this transaction is taxable.

Please let us know if we can be of further assistance.

For the Commission,

Alice Shearer,

Commissioner