Form Pub. Ks-1527 - Kansas Business Tax For Political Subdivisons Page 15
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42a. The term business shall mean a separate place
• Inspection services (code enforcement)
of business subject to registration under the
• Penalty, interest, return check fees or other late
Kansas retailers’ sales tax act.
charges (other than utility sales – see Related
Utility Fees on page 18)
b. The term a complete and bona fide liquidation
• Zoning fees
shall mean the sale of all assets of the business
conducted over a period of not more than 30
The rental or lease of real property, such as the
days beginning on the date of the first sale of
rental of a community building or park shelter, is also
assets, or as approved by the director of
not subject to sales tax.
taxation.
The following services are not subject to sales tax
4. Auctions.
because they are not services that install, apply, service,
alter, or maintain tangible personal property.
a. Take place at a location other than one that is
regularly used to conduct auctions.
• Brush pick-up
• Mowing
b. The goods being auctions shall not have been
• Clean-up service
• Trash service
purchased for resale.
• Firefighting fees
• Tree trimming
c. The goods being auctioned shall not have been
consigned for sale by more than one party IN
ADDITION TO THE PRINCIPAL SELLER at the
auction.
UTILITY SALES
d. If some of the goods being auctioned satisfy the
above requirements but others goods do not, the
sale of every item at the auction shall be subject
to sales tax.
GENERAL RULE
A county holds an annual sale (by auction,
bid, or otherwise) to sell its used and
Whether furnished by a privately owned company or
obsolete equipment. The requirement of
a political subdivision, utilities (electricity, gas, water
an isolated sale is satisfied, therefore the
and heat) are tangible personal property, the retail sale
county would not charge sales tax on the items sold at
of which is subject to the state, county, and city sales
this annual sale.
tax. However, the tax rate applied to utility sales will
vary depending on the customer’s:
A county museum holds an annual auction
as a fund raising event for the museum.
• location (see Which Local Tax Applies?),
Some of the items to be sold are surplus
• tax status (Exempt Utility Buyers), and/or
from the museum, while others were
• utility use (Exempt Utility Uses).
solicited from individuals and businesses in the
community for this event. Since part of the property was
Which Local Tax Applies?
acquired with the intent of reselling it, this sale does not
qualify as an isolated or occasional sale. The county
Most sales are deemed to be transacted (and taxed)
museum must collect sales tax on the final auction price
at the location of the retailer’s place of business.
of all items sold.
However, the sale or furnishing of gas, water, electricity,
heat, (as well as telephone and cable TV service) are
deemed to be transacted (and taxed) at the rate in effect
NONTAXABLE FEES AND SERVICES
at the customer’s location (K.S.A. 12-191).
As a general rule, fees or charges by a political
A city furnishes water to commercial
subdivision are not taxable if there is no retail sale of
customers inside and outside the city
tangible personal property or taxable services. The
limits. The city has a sales tax of .5%, and
following is a representative list of fees or charges by a
the county a sales tax of 1%. The city will
political subdivision that are not subject to sales tax.
charge 7.8% (the 6.3% state plus the 1% county rate
plus the .5% city rate) on water sold to commercial
• Building permits
customers within the city limits.
• Business licenses
• Camping fees or park permits
On water sold to commercial customers in the county
• Construction permits
but outside the city limits, the city will charge 7.3%
• Court fines, court costs and bonds
• Dog licenses or animal control fees
(6.3% state plus the 1% county) tax. The city will charge
• Fees for copies of information (such as accident
the 6.3% state sales tax on water sold to commercial
reports, transcripts, or court documents)
customers located in another county that has no city or
• Hearing fees
county sales tax.
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Parent category: Financial