The following is a restatement of the facts as presented in your letter. The labels, called door forms, itemize the customer order, the location of the customer's home and the price of the pizza. Arizona imposes a transaction privilege tax which differs from the sales tax imposed by most states. This tax is levied on the vendor , not the purchaser. A.R.S. 42-1310.01 levies the transaction privilege tax on the business of selling tangible personal property at retail.
All retail sales are subject to tax unless specifically exempted by statute.
However, subsection F states that items such as price tags, shipping tags, and advertising matter used in connection with the subsequent sale is taxable as a retail sale. Therefore, if these labels are to be affixed to the container given to the customer in the ordinary course of business, they are considered to be resold. As such, the sale of these labels is exempt as a sale for resale. However, gross receipts from the sale of items transferred by a restaurant for the convenience or operation of the restaurant are taxable. Such items include advertisements and similar property.