Sales Tax State Activity Update - April 2005

Florida Contractor Learns the ABC's of Taxation

In a technical assistance advisement, the Florida Department of Revenue indicates that the procedures outlined in an agreement between a Florida school board and a construction contractor were sufficient to permit the school board to exempt the purchase of materials to construct a new K-8 school.

Florida statutes and regulations provide an exemption for sales to the following government entities:

• Federal
• State
• County
• Municipality
• Other political subdivision

This assumes that payment is made directly to the dealer by the governmental entity and the criteria for claiming the exemption are met.

In this case, the procedures outlined in the agreement were sufficient to exempt the purchases by the School Board. It was noted that the exemption did not apply to materials the contractor self-fabricated or self-manufactured.

View the ruling here.

( Florida Technical Assistance Advisement, No. 05A-004, January 20, 2005 )

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