Tax 11.78 NoteNote: The interpretations in s. Tax 11.78 are effective under the general sales and use tax law on and after September 1, 1969, except that the separate impositions of tax on coins and stamps sold above face value under s. 77.52 (1) (b), Stats., certain leased property affixed to real property under s. 77.52 (1) (c), Stats., and digital goods under s. 77.52 (1) (d), Stats., became effective October 1, 2009, pursuant to 2009 Wis. Act 2. Tax 11.78 HistoryHistory: Cr. Register, January, 1977, No. 253, eff. 2-1-77; am. (2) (a), cr. (2) (e), Register, March, 1991, No. 423, eff. 4-1-91; EmR0924: emerg. am. (1) (intro.), (d), (g), (2) (intro.) and (c), eff. 10-1-09; CR 09-090: am. (1) (intro.), (d), (g), (2) (intro.) and (c) Register May 2010 No. 653, eff. 6-1-10; CR 10-094: am. (title), (1) (g) Register November 2010 No. 659, eff. 12-1-10. Tax 11.79Tax 11.79 Leases of highway vehicles and equipment. Tax 11.79(1)(1) General rule. The sales price received from the license, lease, or rental of motor vehicles and mobile equipment used on a highway is subject to the sales and use tax. Tax 11.79 NoteNote: See s. Tax 11.32 for additional information explaining what is included in the “sales price.” Tax 11.79(2)(2) Deductions from sales price. In determining a lessor’s taxable receipts under sub. (1), the cost of the following items may be deducted if they meet the conditions in sub. (3): Tax 11.79(2)(d)(d) Public liability insurance furnished by the lessor solely for the protection of the lessee but not including collision and comprehensive coverage. Tax 11.79(3)(a)2.2. The charge is separately stated in the lease agreement, billing, or invoice. Tax 11.79(3)(a)3.3. The lessor is willing and able to lease the motor vehicle or mobile equipment without providing the items listed in sub. (2). Tax 11.79(3)(b)(b) The deduction is limited to the lessor’s cost of the items furnished with the leased equipment. Tax 11.79(4)(4) Nondeductible items. In determining a lessor’s taxable sales price under sub. (1), the cost of the following may not be deducted: Tax 11.79(4)(a)(a) Amounts spent for the lessor’s own protection or for the protection of leased property, including collision or other insurance protection. Tax 11.79(4)(c)(c) Interest and other financing costs incurred by the lessor. Tax 11.79(5)(a)(a) The sales price received from the license, lease, or rental of motor vehicles and mobile equipment used on a highway is taxable in Wisconsin if the license, lease, or rental payments are sourced to Wisconsin under s. 77.522, Stats., as described in pars. (b) and (c). Tax 11.79(5)(b)(b) A license, lease, or rental of a motor vehicle, trailer, semitrailer, or aircraft that only requires one payment, is sourced as follows: Tax 11.79(5)(b)1.1. If the motor vehicle, trailer, semitrailer, or aircraft is received by the lessee or licensee at the lessor’s or licensor’s business location, the payment is sourced to the lessor’s or licensor’s business location. Tax 11.79(5)(b)2.2. If the motor vehicle, trailer, semitrailer, or aircraft is not received by the lessee or licensee at the lessor’s or licensor’s business location, the payment is sourced to the location where the lessee or licensee or the lessee’s or licensee’s designated donee receives the product. This would include the location indicated by instructions known to the lessor or licensor for delivery to the lessee or licensee or the lessee’s or licensee’s designated donee. The delivery may be made by the lessor or licensor or by a shipping company hired by the lessee or licensee. Tax 11.79(5)(b)3.3. If the location cannot be determined under subds. 1. and 2., the payment is sourced to the lessee’s or licensee’s address as indicated by the lessor’s or licensor’s business records, if the records are maintained in the ordinary course of the lessor’s or licensor’s business and if using that address to establish the location of the lease, license, or rental is not in bad faith. Tax 11.79(5)(b)4.4. If the location cannot be determined under subd. 1., 2., or 3., the payment is sourced to the lessee’s or licensee’s address as obtained during the consummation of the license, lease, or rental, including the address indicated on the lessee’s or licensee’s payment instrument, if no other address is available and if using that address to determine the location of the lease, license, or rental is not in bad faith. Tax 11.79(5)(b)5.5. If the location cannot be determined under subd. 1., 2., 3., or 4., the payment is sourced to the location from which the motor vehicle, trailer, semitrailer, or aircraft was shipped. Tax 11.79(5)(c)(c) Except as provided in par. (b), licenses, leases, and rentals of motor vehicles, trailers, semitrailers, and aircraft that are not transportation equipment, as defined in s. 77.522 (1) (a) 2., Stats., are sourced to the primary location of such property as indicated by an address for the property that is provided by the lessee or licensee and that is available in the business records of the lessor or licensor that are maintained in the ordinary course of the lessor’s or licensor’s business, provided the use of such address does not constitute bad faith. Tax 11.79(6)(6) Exempt leases. The sales price from the license, lease, or rental of the following property shall be exempt from sales and use tax provided the lessor receives a properly completed exemption certificate as described in s. Tax 11.14: Tax 11.79(6)(a)(a) Highway vehicles, except automobiles, leased to common or contract carriers who use the vehicles exclusively in common or contract carriage, including urban mass transportation of passengers as defined in s. 71.38, Stats. Tax 11.79(6)(b)(b) Motor vehicles not licensed for highway use which are used exclusively and directly in conjunction with waste reduction or recycling activities described in s. 77.54 (5) (c), Stats. Tax 11.79(6)(c)(c) Mobile units used for mixing and processing, including the motor vehicle or trailer on which the unit is mounted. Accessories, attachments, parts, supplies, and materials for the mobile unit, vehicle, and trailer are also exempt. Tax 11.79 NoteNote: The interpretations in s. Tax 11.79 are effective under the general sales and use tax law on and after September 1, 1969, except: (a) The exemption for vehicles and equipment used in waste reduction or recycling activities became effective July 1, 1984, pursuant to 1983 Wis. Act 426; (b) The exemption for mobile mixing units became effective July 20, 1985, pursuant to 1985 Wis. Act 29; (c) The sourcing provisions under s. 77.522, Stats., became effective October 1, 2009, pursuant to 2009 Wis. Act 2; and (d) The change of the term “gross receipts” to “sales price” became effective October 1, 2009, pursuant to 2009 Wis. Act 2. Tax 11.79 HistoryHistory: Cr. Register, January, 1977, No. 253, eff. 2-1-77; cr. (4) (d), Register, September, 1984, No. 345, eff. 10-1-84; cr. (6), Register, June, 1991, No. 426, eff. 7-1-91; EmR0924: emerg. am. (1), (2) (title), (intro.), (a), (4) (intro.), (6) (intro.) and (c), renum. (3) to be (3) (a) and (b) and am. (3) (a) 2., r. and recr. (5), eff. 10-1-09; CR 09-090: am. (1), (2) (title), (intro.), (a), (4) (intro.), (6) (intro.) and (c), renum. (3) to be (3) (a) and (b) and am. (3) (a) 2., r. and recr. (5) Register May 2010 No. 653, eff. 6-1-10. Tax 11.80(1)(1) Ice, including dry ice, is tangible personal property, the retail sale of which is subject to sales tax, unless sold in an exempt transaction. Ice is sold at retail when it is sold for use or consumption but not for resale. Tax 11.80 NoteExample: Ice used for refrigeration purposes is consumed in the process of refrigeration. Ice used in drinks is purchased for resale by the seller of the drink.
Tax 11.80(2)(b)(b) Sales of ice blocks and ice cubes to restaurants, taverns, grocery stores, and meat markets when the ice is consumed in cooling bottled drinks or preserving foods. Tax 11.80(3)(a)(a) Sales of ice cubes to be used in drinks, including sales to restaurants, taverns, and individuals. Tax 11.80 NoteNote: Ice sold by a food retailer in cubes or crushed form can be ingested for taste. Therefore, a seller may exempt the sale of such ice. If the purchaser uses the ice to keep food or beverages cold rather than ingesting or chewing it, the purchaser is subject to tax on the purchase of the ice.
Tax 11.80(3)(b)(b) Sales to manufacturers, producers, or food processors for use inside the shipping cases of merchandise being transferred to a customer. The sales are exempt as “shipping material” under s. 77.54 (6) (am) 2., Stats. Tax 11.80(3)(bm)(bm) Sales of ice for use inside shipping cases for meat or meat products, regardless of whether such items are used to transfer merchandise to customers. The sales are exempt as “shipping materials” under s. 77.54 (6) (am) 2m., Stats. Tax 11.80(3)(c)(c) Ice sold to manufacturers which is used exclusively and directly by the manufacturer in manufacturing an article of tangible personal property or an item or property under s. 77.52 (1) (b) or (c), Stats., that is destined for sale and that becomes an ingredient or component part of the article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., destined for sale or is consumed or destroyed or loses its identity in manufacturing the article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., in any form destined for sale. Tax 11.80(4)(a)(a) If ice is sold to a person who will use it both for a taxable purpose and nontaxable purpose, such as for refrigeration and for resale, the purchaser may either purchase the ice without tax by providing a properly completed exemption certificate and then pay the applicable use tax on the ice used in a taxable manner or pay tax on the entire purchase price of the ice and then claim a credit on its sales and use tax return for that portion of the ice that is used in a manner that is not subject to tax. Tax 11.80(4)(b)(b) Ice purchased without payment of the tax and subsequently used in a taxable manner is subject to the use tax or sales tax pursuant to s. Tax 11.14 (2) (c). Tax 11.80 NoteNote: The interpretations in s. Tax 11.80 are effective under the general sales and use tax law on and after September 1, 1969, except: (a) The clarification that items must be consumed exclusively and directly by a manufacturer in manufacturing property or items destined for sale became effective August 1, 2009, pursuant to 2009 Wis. Act 28; and (b) The change of the term “gross receipts” to “sales price” and the separate impositions of tax on coins and stamps sold above face value under s. 77.52 (1) (b), Stats., certain leased property affixed to real property under s. 77.52 (1) (c), Stats., and digital goods under s. 77.52 (1) (d), Stats., became effective October 1, 2009, pursuant to 2009 Wis. Act 2. Tax 11.80 HistoryHistory: Cr. Register, September, 1977, No. 261, eff. 10-1-77; am. (4) (b), Register, July, 1987, No. 379, eff. 8-1-87; am. (1), (2) (intro.), (3) (intro.), (a) and (b) and (4) (a), Register, June, 1991, No. 426, eff. 7-1-91; EmR0924: emerg. am. (1), (2) (a), (b), (3) (a) to (c), cr. (3) (bm), r. and recr. (4) (a), eff. 10-1-09; CR 09-090: am. (1), (2) (a), (b), (3) (a) to (c), cr. (3) (bm), r. and recr. (4) (a) Register May 2010 No. 653, eff. 6-1-10; CR 10-094: am. (2) (b), (3) (a) Register November 2010 No. 659. eff. 12-1-10; corrections in (3) (b), (bm) made under s. 13.92 (4) (b) 7., Stats., Register August 2014 No. 704. Tax 11.81Tax 11.81 Industrial gases, welding rods, fluxing materials, and fuels. Tax 11.81(1)(1) General statement. The tax status of retail sales of industrial gases, welding rods, and fluxing materials depends upon the use of the property by the purchaser. Section 77.54 (2), Stats., exempts from the sales tax the sales price from the sales of and the storage, use or other consumption of tangible personal property or item under s. 77.52 (1) (b), Stats., that is used exclusively and directly by a manufacturer in manufacturing an article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., that is destined for sale and that becomes an ingredient or component part of the article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., destined for sale or is consumed or destroyed or loses its identity in manufacturing the article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., destined for sale, except as provided in s. 77.54 (30) (a) 6., Stats. Section 77.54 (30) (a) 6., Stats., exempts from sales and use tax fuel and electricity consumed in manufacturing tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., in this state. Therefore, the sale of industrial gases, welding rods, fluxing materials, or fuels shall be: Tax 11.81(1)(a)(a) Exempt if they are used exclusively and directly by a manufacturer in manufacturing and become ingredients or component parts of tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., destined for sale. Tax 11.81(1)(b)(b) Exempt if they are used exclusively and directly by a manufacturer in manufacturing and are consumed, destroyed, or lose their identity in manufacturing tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., destined for sale. Tax 11.81(1)(bm)(bm) Exempt under s. 77.54 (30) (a) 6., Stats., if they are a fuel consumed in manufacturing tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., in Wisconsin. A fuel is a material used to produce heat or power by burning, or is something that feeds a fire. Tax 11.81(1)(c)(c) Taxable if they are sold to a person who consumes them in a nonmanufacturing activity. Tax 11.81(2)(2) Industrial gases. Common types of industrial gases are argon, helium, hydrogen, nitrogen, acetylene, carbon dioxide, and oxygen. Tax 11.81(2)(a)(a) Sales of industrial gases which are exempt if they are used exclusively and directly by a manufacturer in manufacturing and become an ingredient or component part of an article of tangible personal property or item or property under s. 77.52 (1) (b) or (c), Stats., destined for sale by the purchaser include: Tax 11.81(2)(a)1.1. Carbon dioxide used to produce dry ice or carbonated soft drinks. Tax 11.81(2)(a)2.2. Gases such as neon, helium, or argon used as a filler in the production of light bulbs and tubes. Tax 11.81(2)(a)4.4. Acetylene used as a base in the manufacture of synthetic materials. Tax 11.81(2)(a)5.5. Oxygen used in the chemical industry for oxidation processes, when not used as a fuel to produce heat. Tax 11.81(2)(b)(b) Exempt sales of gases used by a manufacturer as fuel include: Tax 11.81(2)(b)1.1. Oxygen used in industrial furnaces that are used in manufacturing tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., in Wisconsin. Tax 11.81(2)(b)2.2. Acetylene or other gases used in torches that are used in the manufacture of tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats. Tax 11.81(2)(c)(c) Taxable sales of gases to nonmanufacturers, whether or not used by the purchaser as fuel, include: Tax 11.81(2)(c)1.1. Acetylene or other gases used by automobile body shops or by other repair establishments. Tax 11.81(3)(3) Welding rods. Since welding rods, such as stick electrode and filler rods, are physically transferred and become a part of an item produced or repaired, their sale is exempt if used by the purchaser in producing tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., destined for sale or in repairing tangible personal property or items, property, or goods under s. 77.52 (1) (b), (c), or (d), Stats., for a consideration. The sale of welding rods to manufacturers who use them in repairing their machinery used directly and exclusively in manufacturing is exempt. However, the sale of these rods to construction contractors for use in fulfilling real property construction contracts is taxable. Tax 11.81(4)(4) Fluxing materials. Fluxing materials sold to a manufacturer for use exclusively and directly in manufacturing tangible personal property or items or property under s. 77.52 (1) (b) or (c), Stats., destined for sale are exempt because they are consumed in the manufacturing process. When fluxing materials are sold for use by a manufacturer to repair its own production machinery or equipment, a nonmanufacturing activity, they are taxable. Fluxing materials sold to a repair shop or to a real property construction contractor or to any other nonmanufacturer are taxable. Tax 11.81 NoteNote: The interpretations in s. Tax 11.81 are effective under the general sales and use tax law on and after September 1, 1969, except: (a) The exemption for fuel and electricity consumed in manufacturing became exempt January 1, 2006, pursuant to 2003 Wis. Act 99; (b) The clarification that items must be consumed exclusively and directly by a manufacturer in manufacturing property or items destined for sale became effective August 1, 2009, pursuant to 2009 Wis. Act 28; and (c) The change of the term “gross receipts” to “sales price” and the separate impositions of tax on coins and stamps sold above face value under s. 77.52 (1) (b), Stats., certain leased property affixed to real property under s. 77.52 (1) (c), Stats., and digital goods under s. 77.52 (1) (d), Stats., became effective October 1, 2009, pursuant to 2009 Wis. Act 2. Tax 11.81 HistoryHistory: Cr. Register, September, 1977, No. 261, eff. 10-1-77; am. (3) and (4), Register, June, 1991, No. 426, eff. 7-1-91; EmR0924: emerg. am. (title), (1) (intro.), (a), (b), (2) (intro.), (a) (intro.), 2., (b), (3) and (4), cr. (1) (bm), eff. 10-1-09; CR 09-090: am. (title), (1) (intro.), (a), (b), (2) (intro.), (a) (intro.), 2., (b), (3) and (4), cr. (1) (bm) Register May 2010 No. 653, eff. 6-1-10. Tax 11.82Tax 11.82 Mailing lists and mailing services. Tax 11.82(1)(a)(a) In this subsection, “mailing list” means a written or printed list, series, set, group, or aggregation of names or addresses or both or other information concerning persons which is used in circulating material by mail. A mailing list may be in the form of a manuscript list, directory, Cheshire tape, Dick tape, magnetic tape, gummed labels, index cards, or other similar means of identification. Tax 11.82(1)(b)(b) A mailing list is tangible personal property, except for written, typed, or printed lists of names and addresses and lists stored in machine-readable form, such as microfilm and computer tapes and disks, and the sales and use tax shall apply to the sales price from the sale of and the storage, use, or other consumption of mailing lists in the form of tangible personal property, including the rental of or the granting of a license to use those lists. Taxable mailing lists include mailing lists which are physically attached to the envelopes, such as Cheshire tapes, gummed labels, and heat transfers. Tax 11.82(1)(c)(c) Persons in the business of providing mailing lists are the consumers of the tangible personal property and items, property, and goods under s. 77.52 (1) (b), (c), and (d), Stats., they purchase and use in producing these lists. However, any tangible personal property and items, property, and goods under s. 77.52 (1) (b), (c), and (d), Stats., becoming a component part of mailing lists when the mailing lists are physically transferred to a customer by either sale, rental, lease, or license may be purchased for resale and without tax if the purchaser gives the seller a properly completed exemption certificate. Tax 11.82(2)(a)(a) In this subsection, “addressing” means the preparation of property, items, and goods to be mailed by writing, typewriting, printing, imprinting, or affixing addresses or names and addresses to the property, items, or goods. Addressing includes the preparation of Cheshire tapes, Dick tapes, cards, gummed labels, or similar items which are to be affixed to, or enclosed in, property, items, or goods to be mailed for the purpose of serving as addresses for the property, item, or good. However, addressing does not include these tapes, cards, or labels when they are used for some other purpose, such as reproduction or reference. Tax 11.82(2)(b)(b) The tax does not apply to charges for services rendered in preparing material for mailing, including addressing, enclosing, sealing, metering, affixing stamps, sorting, tying, and sacking in compliance with postal rules and regulations, if the charges are stated separately on invoices and in accounting records. The sales price from charges for envelopes is taxable, but not separately stated charges for postage in the sale of prestamped envelopes.
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