Private Letter Ruling

Ruling Number:P-1998-26
Tax Type:Kansas Retailers' Sales Tax
Brief Description:Rock purchased by a rock quarry.
Keywords:
Effective Date:02/27/1998



Body:
Office of Policy & Research

February 27, 1998


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Dear Ms. TTTT:


We wish to acknowledge receipts of your letter dated December 17, 1997, regarding the application of Kansas Retailers’ Sales tax.

The Kansas sales tax is imposed upon retail sales only. Retail sales are sales to final users or consumers. A trucker who provides a properly completed Kansas resale exemption certificate in good faith to your quarry, would be able to purchase said rock exempt from sales tax. The trucker would be obligated to collect and remit the appropriate Kansas sales tax(es) from their respective customer.

K.S.A. 79-3603(l) imposes a sales tax upon: “the gross receipts received from the sales of tangible personal property to all contractors, subcontractors or repairmen of materials and supplies for use by them in. . . improving, altering, or repairing real or personal property of others.”

Therefore, a contractor, subcontractor or repairmen shall not give, and a rock quarry shall not accept, a resale exemption certificate to purchase rock without tax to erect a fence for his customer.

K.S.A. 79-3606(m) imposes a sales tax upon: “all sales of tangible personal property which become an ingredient or component part of tangible personal property or services produced, manufactured or compounded for ultimate sale at retail within or without the state of Kansas.”

In closing, a concrete plant would be able to purchase rock from your quarry which will become an ingredient or component part of finished concrete products manufactured for ultimate sale at retail within or without the state of Kansas by the respective concrete plant. The concrete plant would need to provide your rock quarry with a properly completed Kansas resale exemption certificate, in order to purchase these items of tangible personal property exempt from sales tax.

If I may be of further assistance, please contact me at your earliest convenience at (785) 296-7776.

Sincerely yours,



Thomas P. Browne, Jr.
Tax Specialist

TPB


Date Composed: 03/04/1998 Date Modified: 10/10/2001