RELATES TO:
KRS
139.010,
139.240,
139.260,
139.470,
139.485,
139.720
NECESSITY, FUNCTION, AND CONFORMITY:
KRS
131.130(1) authorizes the
Department of Revenue to promulgate administrative regulations to administer
and enforce Kentucky's tax laws. This administrative regulation establishes the
requirements when interpreting the sales and use tax law as it applies to sales
of tangible personal property through vending machines.
Section 1. Definition. "Bulk vending machine"
is defined by
KRS
139.470(5).
Section 2. Persons who own vending machines
that dispense tangible personal property, or operators of the machines under
lease or rental agreements, shall complete a "Kentucky Tax Registration
Application", Revenue form 10A100, to obtain a Kentucky Retail Sales and Use
Tax permit to engage in the business of selling tangible personal property and
shall report and pay to the department the tax upon the gross receipts from
sales made through the machines by utilizing Revenue Form 51A102, "Sales and
Use Tax Return". One (1) permit shall be sufficient for all machines of one (1)
owner or operator.
Section 3. The
owners or operators of vending machines shall be responsible for reporting and
paying the tax on the total gross receipts even though the owner or operator of
the place in which the machines are located receives a share of the gross
receipts under a commission or concession contract. In reporting and paying the
tax, the owner or operator shall be deemed the agent of the operator or owner
of the place of business in which the machine is located to the extent of
commissions due the latter. Gross receipts from bulk vending machine sales of
tangible personal property made in portions of fifty (50) cents or less are
exempt from the sales and use tax pursuant to
KRS
139.470(5).
Section 4. A statement in the following form
shall be affixed upon each vending machine in a conspicuous place: "This
vending machine is owned (operated) by _______ Owner (Operator), __________
Place of Business of Owner (Operator), who holds Permit No. _____, issued
pursuant to the Sales and Use Tax Law."
Section
5. If the owner or operator of vending machines also places upon
each machine a statement that the sales tax is included in the price of the
property dispensed, the liability for the tax may be computed in the same
manner as all other retailers who separately state the tax.
Section 6. Adequate and complete records
shall be kept by the owner or operator showing the location of each vending
machine owned or operated, the serial number thereof, purchases and inventories
of merchandise bought for sale through each machine, and the gross receipts
derived from each location during each tax period.
Section 7. Forms. The forms listed within
this administrative regulation may be inspected, copied, or obtained:
(1) At the Kentucky Department of Revenue,
501 High Street, Frankfort, Kentucky 40620;
(2) At a Kentucky Taxpayer Service Center;
or
