Sales Tax Articles
Sales Tax State Activity Update - September 2006
Tennessee Probes Into Urethral Catheters
The Tennessee Department of Revenue has issued a Revenue Ruling to discuss the taxability of specific medical equipment used in a common procedure performed by urologists.
An Ureteroscopy is an examination of the upper urinary tract, usually performed with an endoscope that is passed through the urethra, bladder, and then directly into the ureter. The procedure is useful in the diagnosis and the treatment of disorders such as kidney stones.
Ureteral catheters are used to facilitate essential preliminary procedural components of ureteroscopy.
Once the catheter is attached to the ureteral opening, a Contrast dye is inserted through the catheter to allow for visualization, followed by the insertion of a guidewire to ease the subsequent advancement of instrumentation. The catheters under issue for this Revenue Ruling are sold by a manufacturer and distributor of medical devices to physicians, hospitals, and other medical facilities.
Tenn. Code Ann. ยง 67-6-314(5) provides, in pertinent part, an exemption for prosthetics and other medical corrective or support appliances and devices. A 1988 Tennessee Supreme Court Case Opinion defined prosthetic as a device that replaces a missing body part or augments the performance of a natural function. Ureteral catheters do not meet the definition of a prosthetic device, as they enable urologists a view inside the body for diagnostic purposes only. There is no applicable exemption for diagnostic or surgical tools. The ureteral catheters are subject to Tennessee sales and use tax.
The full ruling may be accessed on the State of Tennessee Website.
(Tennessee Department of Revenue, Revenue Ruling #06-13, 4/28/06)
Subscribe to CyberTax News and receive the latest indirect tax news, including rate changes, rule updates, compliance issues, and more, delivered directly to your email.
Call 800.355.3500 to Speak to a Sales Representative.
