Missouri, Delivery Charges, and Sales Tax
- Mar 24, 2014 | Gail Cole
Delivery charges may be subject to sales tax in Missouri. A recent Missouri Department of Revenue explains that when delivery is an expected part of the transaction, and when the risk of loss and the title don’t transfer to the buyer until the delivery is complete, then delivery charges are taxable. The same is true for separately stated delivery charges.
Delivery by common carrier
Deliveries made “in Missouri by common carrier selected and paid” by the seller are also subject to sales tax, when the delivery is an expected part of the transaction.
Delivery by drop shipment
Again, so long as the delivery is an expected part of the transaction, drop shipments from a wholesaler or manufacturer to a customer are subject to sales tax.
Letter rulings are binding upon the Missouri Department of Revenue (and indeed, all state departments of revenue) for a limited period of time, and they pertain only to the taxpayer discussed in the ruling. However, letter rulings also reference state law and are indicative of a state’s tax policy.
You can read through letter rulings in all states where you do business, or you can switch to an automated sales tax solution.