Mississippi: Flea Market or Garage Sale?
- Sales Tax News
- Dec 19, 2012 | Gail Cole
It seems like times are tough when state tax auditors start visiting flea markets, as the Picayune Item reports happened earlier this month in Poplarville, Mississippi. Several vendors there were told they had to obtain a permit in order to operate their businesses in that location, to the tune of $500.
However, it may be a question of fairness. City officials "had received complaints from some merchants about the vendors not paying state sales taxes while merchants have to." In Mississippi, businesses are subject to state and local fees and taxes.
But is a stall in a parking lot a business? It may be. The vendors in question were located in a parking lot between a Pizza Hut and a shuttered restaurant. One vendor reportedly said "he was selling assorted merchandise out of his stall, 'like in a yard sale.'" However, the vendor was not in his yard.
That's a relevant point. Poplarville Alderwoman Shirley Wiltshire learned from city officials in other cities that anyone operating "on a continuing regular basis" could not qualify as a yard sale because a yard sale has "a specific time frame." Pursuant to relevant state statutes, "… every person engaging or continuing within this state in the business of selling any tangible personal property whatsoever…" shall levy, assess and collect tax on "the gross proceeds of the retails sales of the business." (Miss. Code Ann. § 27-65-17 (2012)). The code also notes that "[i]solated or occasional sales are exempt." (Miss. Code Ann. § 27-65-27 (2012)).
According to the Mississippi Department of Revenue,
"The operator or promoter of a flea market, antique mall or similar type of event is considered the seller and is responsible for collecting and remitting the sales tax collected by persons selling at these events. Any vendor who holds a retail sales tax permit should not report tax from an event under his/her number, but instead report their individual sales to the promoter or operator. All taxes collected from these events must be reported by the promoter or operator."
The issue is a bit less clear when there is no "promoter or operator."
City Clerk Jodi Stuart commented on the matter, "If the state is telling you, you have to have a certain permit to operate, then the city is out of it and has no control over it." However, city officials intended to look into the matter.
Local aldermen said they would defer to the state until they had "an official opinion on the issue" from the board's attorney.
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