Idaho: Sales Tax and Municipal Wastewater Treatment Plants
- Mar 3, 2015 | Gail Cole
The Idaho State Tax Commission has updated information regarding the application of Idaho sales and use tax to municipal wastewater treatment plants, the cities that own and operate them, and the contractors who work on them.
Tax typically applies to sales of materials that are incorporated into real property. The contractor is generally considered to be the consumer of these materials and, as such, is responsible for paying the sales or use tax. Asphalt, plastic, and composite pond linings are exempt from sales tax.
Sales of materials “that retain their identity as tangible personal property are considered to be retail sales to the municipality,” and municipalities, as government entities, are generally exempt from sales tax. Contractors may therefore purchase such materials exempt from sales tax, provided they give the vendor an ST-101 form “for all equipment purchased for resale to the municipality that owns the wastewater treatment plant.”
Additional information, including a list of items considered to be real property improvements and a list of items that retain their identity as tangible personal property, is available in the Idaho Tax Commission guide to Municipal Wastewater Treatment Plants.
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