Wyoming Talks Remote Sellers and Sales Tax

Remote seller tax laws, local sales tax rate changes, and other issues are discussed in a Department of Revenue newsletter.

Remote Seller Legislation Not Enforced Pending Legal Action

A 2017 law, H.B. 19, that requires certain remote sellers (sellers not located in Wyoming) to collect and remit Wyoming sales tax will not be enforced pending a legal action. The action involves the Department seeking a declaratory judgment from the Second Judicial District of the State of Wyoming.

H.B. 19 prohibits the Department from enforcing the law against a remote seller while this legal action is pending. Although the Department cannot require a business to become licensed at this time, a company can voluntarily choosing to be licensed to collect and remit sales tax.

October 2017 Local Rate Changes

In addition, several local rate changes are effective as of October 1, 2017.

The Laramie County sales and use tax rate will increase from 5% to 6%. The county’s combined sales, use, and lodging tax rate will increase from 9% to 10%.

The Teton County sales and use tax rate will increase from 5% to 6%. The county’s combined sales, use, and lodging tax rate will increase from 7% to 8%.

The combined sales tax (6%) and resort tax (2%) rates for Teton Village Resort District and Grand Targhee Resort District will be 8%. Their combined sales, use, and lodging tax rates will be 10%.

Also, the 2% resort district tax is only collected by vendors physically located within the boundaries of the resort district.

Vendor Deposit Charges

When a retailer charges a deposit for a returnable–reusable item, such as a pallet, keg, tap, or bit, the deposit represents a sales price of the returnable– reusable item and is taxable. Thus, when customers return the item, they are entitled to a refund of the deposit and the sales tax associated with the deposit. However, if the item is not returned, the customers will forfeit their deposit.

Merchandise Donated for Raffles

When a business donates items to an organization for a raffle, the items removed from inventory are taxable to the business based on their cost of the item. When the raffle is for a chance to win a motor vehicle, motor cycle, or trailer, the winner of the raffle should not be provided an invoice, bill of sale, etc., denoting a purchase price, because winning a raffle is not a purchase of the item won. The tax liability belongs to the business that donated the item. And, in the case of a motor vehicle, the tax liability should be paid directly to the county treasurer.

Business Purchases of Consumables

Finally, the department notes that items purchased by businesses to perform business activities are taxable to the business, including:

  • tools,
  • trucks,
  • lubricants,
  • fuel,
  • shop rags,
  • safety equipment, and
  • cleaning supplies,

Oftentimes, businesses will place a charge for shop supplies (consumables) on their customers’ invoices. This charge is typically based on a percentage of the sales price of the sale or service provided. Such a charge is taxable to the customer as part of taxable sale or service provided.

Taxing Issues, Wyoming Department of Revenue, Excise Tax Division, Vol. 20, Quarter 3, September 2017

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All stories by: CCHTaxGroup