Sales Tax Articles
Sales Tax State Activity Update - March 2006
Sit, Beg, Roll Over, Pay Sales Tax - New York Looks at Pet Containment
The New York Tax Department recently ruled that the sale of installation of pet containment systems on real property, including materials and labor is subject to sales tax. The Department indicates that upon installation, the pet containment system does not qualify as a capital improvement.
In order to be considered a capital improvement, New York sales and use tax law requires the installation must substantially add to the value of the real property or appreciably prolong its useful life, become part of the real property or permanently affixed so that removal would cause material damage to the property and have the intention of being permanent.
Upon review of the facts, the Department decided the installation of the pet containment system is not permanently affixed to the real property such that removal would cause material damage to the property or article itself. The installation of the pet containment system remains tangible personal property upon installation and the receipts from such sale, including materials and labor, are subject to sales tax.
View the full text on the New York State Department of Taxation and Finance website.
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