Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-6-1 - GROSS PROCEEDS OF SALES; GROSS RECEIPTS; WHOLESALE SALES, SALES AT WHOLESALE; RETAIL SALES, SALES AT RETAIL; AUTOMOTIVE VEHICLES › Section 810-6-1-.08.01 - Automotive Supply Jobbers, Sales by

Current through Register Vol. 42, No. 9, June 28, 2024
(1) Automotive supply jobbers must comply
			 with Title 40 by maintaining the records necessary to determine the amount of
			 their sales or use taxes liability. Title 40 includes the requirement that
			 their records show the gross proceeds of wholesale sales and the gross proceeds
			 of retail sales separately. Automotive supply jobbers must also comply with
			 Rule
			 810-6-4-.10 entitled Keeping Records Of Sales For Resale.
(2) Automotive supply jobbers must collect
			 sales or use tax on sales to all customers who do not have a valid Sales Tax
			 License Number or Certificate of Exemption Number. Invoices made out to "cash"
			 that do not show the purchaser's name will be considered to be retail sales
			 invoices.
(3) The automotive supply
			 jobber may sell to the purchaser tax exempt when the purchaser has a sales tax
			 license and is buying the items for resale. The automotive supply jobber is not
			 relieved of the responsibility of collecting tax on the items the licensed
			 purchaser uses. The automotive supply jobber's responsibility is to know the
			 nature of the customer's business and when to collect tax on items purchased
			 for use.
(4) Sales of automotive
			 parts to licensed automotive vehicle dealers with repair shops or service
			 departments are at wholesale and tax-free. Sales of automotive parts to
			 licensed automotive vehicle dealers without repair shops or service departments
			 are taxable unless the dealer qualified for the exemption contained in §
								40-23-1(a)(9) for parts purchased for use in repairing or reconditioning automobiles that are
			 a part of the dealer's stock of goods for sale. See Rule
			 810-6-1-.116 entitled Parts And Materials Used To Repair Or Recondition Dealer's Automotive
			 Vehicles.
(5) Sales of materials to
			 licensed automotive vehicle dealers are taxable unless the dealer qualifies for
			 the exemption contained in §
								40-23-1(a)(9) for materials purchased for use in repairing or reconditioning automotive
			 vehicles that are a part of the dealer's stock of goods for sale. See Rule
			 810-6-1-.116 entitled Parts And Materials Used To Repair Or Recondition Dealers' Automotive
			 Vehicles. The term "materials" as used in this section includes paint, solder,
			 flux, body lead, wax, underseal, and tire blacking that become a part of the
			 reconditioned automotive vehicle. The term "materials" as used in this section
			 does not include items that do not become a part of the reconditioned
			 automotive vehicle such as sandpaper, thinner used for cleaning purposes,
			 masking tape, rags, brushes, tools, and soap.
(6) The automotive supply jobber must collect
			 sales or use tax on sales of supplies unless the customer is purchasing the
			 supplies for resale. Supplies include but are not limited to cleaning
			 compounds, chamois, rags, drill bits, shop files, welding gases and supplies,
			 metal bars and rods, masking tape, fire extinguisher fluid, hydraulic jack oil,
			 friction tape, signs, white sidewall cleaner, brooms, mops, window cleaner,
			 rivets, tacks, cotter pins, repair parts for shop equipment, degreaser, bolts,
			 nuts, washers, screws, oil measures, wiping cloths, drop light cords, auto body
			 soap, hand soap, vixen files, light bulbs, rubbing compound, floor oil
			 absorbent compounds, brushes of all kinds, tar remover, and polishing
			 cloths.
(7) The automotive supply
			 jobber must collect sales or use tax on sales of power tools, heavy tools, and
			 equipment and replacement parts unless the customer is purchasing the tools,
			 equipment, or replacement parts for resale. Power tools, heavy tools, and
			 equipment and replacement parts include but are not limited to floor jacks, air
			 compressors and parts, washing equipment and parts, painting equipment and
			 parts, electric sanders, air hose and chucks, drop cords, and welding equipment
			 and parts.
(8) The automotive
			 supply jobber must collect sales or use tax on sales of hand tools unless the
			 customer is purchasing the tools, equipment, or replacement parts for resale.
			 Sales of hand tools to licensed resellers who do not stock such tools for
			 resale are taxable.
(9) The
			 automotive supply jobber must collect sales or use tax on sales to automobile
			 painters or repair shops of items that lose their identity, such as paint,
			 solder, and solvents.
(10) The
			 measure of sales or use tax due on taxable sales of any new, used, or rebuilt
			 automotive parts, except batteries, is the net trade difference, that is the
			 selling price less credit for the used part taken in trade. The measure of
			 sales or use tax due on taxable sales of batteries is the total sales price of
			 the battery without deduction or credit for the value of the used taken in
			 trade (See Rules
			 810-6-1-.12 entitled Automotive Vehicles and
			 810-6-1-.180 entitled Truck Trailers And Semitrailers for definitions of automotive vehicle
			 and trailer).
(11) If automotive
			 supply jobbers perform labor in connection with a sale of repair parts,
			 invoices covering the transaction must clearly show the amounts charged for
			 each part and amounts charged for labor. For invoices not showing parts and
			 labor separately, sales tax is due on the total amount of the
			 invoice.
(12) If automotive supply
			 jobbers provide tire recapping service to a customer, they must collect sales
			 or use tax from the customer measured by the total amount billed for the
			 recapping service. Materials used by the automotive supply jobber in performing
			 the recapping service are not taxable when purchased or withdrawn by the
			 automotive supply jobber. The machines used directly in the recapping process
			 by the automotive supply jobber are taxable at the reduced machine rate when
			 purchased or withdrawn by the automotive supply jobber. The Machines and
			 equipment not used directly in the recapping process and all materials and
			 supplies that do not become a component part of the finished product are
			 taxable at the general rate when purchased or withdrawn by the automotive
			 supply jobber.
Authors:
Dan DeVaughn, Leslie Michaud
Statutory Authority:
Code of Ala.
				  1975
, §§
										40-2A-7(a)(5),
				  40-23-1(a)(9),
				  40-23-2(1),
				  40-23-9,
				  40-23-26,
				  40-23-31,
				  40-23-67,
				  40-23-83.