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BTLG Table of Contents > Sales and Use Tax Annotations > G > 295.0000 Gross Receipts > Annotation 295.1640

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G

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295.0000 Gross Receipts

Annotation 295.1640

(g) Service Charges Generally

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295.1640 Procurement Fee. A supply company agreed to obtain furniture and fixtures for the outfitting of a hotel. It was to be compensated at the rate of 5 percent of the cost of such furniture and fixtures. Where the supply company placed orders for such property with vendors, on behalf of the hotel, and the invoices were made out to the hotel as purchaser; the supply company acted in the capacity of agent for the hotel. The 5 percent fee, measured by the cost of such property, which the supply company received was an exempt service charge.

Where the supply company purchased furniture and fixtures as a franchised dealer under its own resale certificate, it did not act in the capacity of an agent. It purchased such property for its own account for resale and resold it to the hotel corporation. Therefore, its entire receipts from such transactions, including the 5 percent, constituted taxable gross receipts. 10/30/64.