Whether such a transaction is a sale or lease of tangible personal property subject to tax, or a nontaxable service depends on the facts and circumstances. A charge is not inconsequential if it exceeds ten percent of the total charge. If the value of the tangible personal property is less than ten percent of the total charge, the entire transaction above will be exempt from sales tax. In such a case, the service enterprise must pay a sales or use tax at the time it purchases the unit from a supplier. If charges for the rental of the portable toilet units are separately stated from charges for servicing them, it does not matter whether the cost of the units is consequential or inconsequential in relation to the total cost.
Sales tax is imposed only on the separately stated rental charges.
Sales and Use Tax Returns and Payments . A retail sale is defined as a sale of tangible personal property for any purpose other than resale in the regular course of business, excluding personal service transactions which involve no sale or which involve sales as inconsequential elements for which no separate charges are made. The sales tax is calculated based on the sales price of the tangible personal property. In determining the sales price, any amount paid for any services that are a part of the sale is included. The rental of portable toilet units under a rental and service agreement involves both the transfer of tangible personal property, the portable toilet unit itself, and a service, the cleaning and maintenance of the unit.