Which of four one-time-use cardiac-catheterization devices were exempt from Florida sales tax?

Subject

Cardiac Catheterization Medical Devices

Plain-English summary

Response E.P. Catheters and Pacel Bipolar Pacing Catheters were exempt from tax as specifically listed prosthetic or orthopedic appliances. The first delivered an electrical jolt during heart repair, and the second temporarily paced the heartbeat.

Peel-Away Introducers and Fast-Cath Introducers were taxable as medical equipment used in treatment unless the purchaser provided a properly executed resale and exemption certificate at the time of sale. Those introducers created passageways into the heart for the described procedures.

What this means for you

Medical use alone did not make every product exempt. The ruling distinguished devices specifically listed as exempt catheters from introducers treated as taxable medical equipment.

Common questions

Were hospital purchases automatically exempt? No. The cited rule generally treated sales of medical products and supplies to hospitals as taxable unless specifically exempt.

Why were the two catheters exempt? The applicable rule specifically listed catheters as prosthetic or orthopedic appliances.

Could the introducers be sold without tax? Only under the ruling's stated certificate condition.

Citations and references

• Fla. Stat. §§ 212.05(1)(a)1.a., 212.08(2)(a), 212.21(2), and 213.22
• Fla. Admin. Code rr. 12A-1.020(6)(a)-(b), 12A-1.021(1)(a)-(b), and 12A-1.038(1)

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 94A-018

Original ruling text

Feb 25, 1994

Re: TAA 94A-018
Cardiac Catheterization Medical Devices
Sections 212.05(1)(a)1 a., 212.08(2)(a), 212.21(2), F.S.
Rules 12A-1.020(6)(a) and (b), 12A-1.021(1)(a) and (b),
12A-1.038(1), F.A.C.

Dear

This is in response to your letter of January 28, 1994, and
our telephone conversation of February 2, 1994. In your letter
you requested the issuance of a technical assistance advisement
concerning the taxability of certain cardiac catheterization
medical devices which your company sells to hospitals in XXXXX.
You enclosed brochures on the products in question.

In our telephone conversation you gave the following
information regarding the products listed below which are used
in cardiovascular surgery.

Peel-Away Introducers

A device which is used to open a passage into the heart by
way of a blood vessel during heart surgery. It is sold as
a single item for one time use.

Response E. P. Catheter

A device which is used in repairing the heart. It is
inserted into the heart to deliver an electrical jolt. It
is sold as a single item for one time use.

Pacel Bipolar Pacing Catheter

It is used in the temporary pacing of the heart beat. It
is sold as a single item for one time use.

Fast-Cath Introducers

A device which is inserted into a vein in the neck or groin
which is used as a passageway to the heart for guidewires
used for medical procedures. It is sold as a single item
for one time use.

APPLICABLE AUTHORITY

Section 212.05(1)(a)1.a., F.S., provides in part:

"212.05 Sales, storage, use tax.--It is hereby declared to
be the legislative intent that every person is exercising a
taxable privilege who engages in the business of selling
tangible personal property in this state....
"(1) For the exercise of such privilege, a tax is levied on
each taxable transaction or incident, which tax is due and
payable as follows:
"(a)1.a. At the rate of 6 percent of the sales price of
each item or article of tangible personal property when
sold at retail in this state, computed on each taxable sale
for the purpose of remitting the amount of tax due the
state, and including each and every retail sale...."

Section 212.21(2), F.S., provides in part:

"(2) It is hereby declared to be the specific legislative
intent to tax each and every sale, admission, use, storage,
consumption, or rental levied and set forth in this
chapter, except as to such sale, admission, use, storage,
consumption, or rental as shall be specifically exempted
therefrom by this chapter subject to the conditions
appertaining to such exemption."

Section 212.08 (2) (a), F.S., provides in part:

"(2) EXEMPTIONS; MEDICAL."(a) There shall be exempt from the tax imposed by this
chapter any product, supply, or medicine dispensed in a
retail establishment by a pharmacist licensed by the state,
according to an individual prescription or prescriptions

written by a prescriber authorized by law to prescribe
medicinal drugs; hypodermic needles; hypodermic syringes;
chemical compounds and test kits used for the diagnosis or
treatment of human disease, illness, or injury; and common
household remedies recommended and generally sold for
internal or external use in the cure, mitigation,
treatment, or prevention of illness or disease in human
beings, but not including cosmetics or toilet articles,
notwithstanding the presence of medicinal ingredients
therein, according to a list prescribed and approved by the
Department of Health and Rehabilitative Services, which
list shall be certified to the Department of Revenue from
time to time and included in the rules promulgated by the
Department of Revenue. There shall also be exempt from the
tax imposed by this chapter artificial eyes and limbs;
orthopedic shoes; prescription eyeglasses and items
incidental thereto or which become a part thereof;
dentures; hearing aids; crutches; prosthetic and orthopedic
appliances; and funerals...."

Rule 12A-1.038(1), F.A.C., provides:

"(1) It is the specific legislative intent that each and
every sale, admission, use, storage, consumption or rental
is taxable under Chapter 212, F.S., unless such sale,
admission, use, storage, consumption or rental is
specifically exempt. The exempt status of the transaction
must be established by the dealer. Unless the dealer shall
have taken from the purchaser a certificate to the effect
that the property or service was purchased for resale and
bearing the name and address of the purchaser, the
effective date of the certificate and the number of his
dealer's certificate of registration, or a certificate
bearing the number of his consumer's exemption certificate,
and the effective date of the certificate, the sale shall
be deemed to be a taxable sale at retail, except sales of
alcoholic beverages by distributors, licensed by the
Division of Alcoholic Beverage and Tobacco, Department of
Business Regulation."

Rule 12A-1.020(6)(a) and (b), F.A.C., provides:

"(6)(a) Medical products and supplies used in the cure,
mitigation, alleviation, prevention or treatment of injury,
illness, disease or incapacity are taxable, unless:
"1. Temporarily or permanently incorporated into a patient
or client by a practitioner of the healing arts licensed by
the State of Florida.
"2. Ordered and dispensed by or on the prescription of a
duly licensed practitioner authorized by the laws of the
state to prescribe medicinal drugs; or
"3. Ordered and dispensed by a pharmacist pursuant to the
established dispensing procedures determined by the joint
committee of medical, osteopathic and pharmacy professions
as created by section 465.186, F.S.
"(b) The sale of medical products or supplies to
physicians, dentists, veterinarians and hospitals is
taxable even though the medical products or supplies may be
used in connection with medical treatment, unless the
products and supplies are specifically exempt from tax
under this rule or in Rule 12A-1.021, F.A.C."
Rule 12A-1.021(1)(a), and (b), F.A.C., provides in part:

"(1)(a) Prosthetic and orthopedic appliances are exempt.
The term `prosthetic and orthopedic appliances' means any
apparatus, instrument, device, or equipment used to replace
or substitute for any missing part of the body, used to
alleviate the malfunction of any part of the body, or used
to assist any disabled person in leading a normal life by
facilitating such person's mobility. Such apparatus,
instrument, device, or equipment shall be exempted
according to an individual prescription or prescriptions
written by a duly licensed practitioner authorized by the
laws of the state to prescribe medicinal drugs, or
according to a list prescribed and approved by the
Department of Health and Rehabilitative Services, which
list shall be certified to the Department from time to
time. A list of prosthetic and orthopedic appliances (DR46NT), Nontaxable Medical and General Grocery List, dated
October, 1987, which is incorporated in this rule and made
part of this rule by reference, which has been certified to
the Department of Revenue by the Department of Health and

Rehabilitative Services, is available without cost, upon
written request directed to the Department of Revenue,
Supply Section, Tallahassee, Florida 32399-0100.
"(b) The prosthetic and orthopedic appliances listed below
are specifically exempt:...
"Catheters...."

DEPARTMENT RESPONSE

The Response E.P. Catheters and the Pacel Bipolar Pacing
Catheters are specifically exempt from tax as seen in Rule 12A1.021(1)(b), F.A.C., as prosthetic or orthopedic appliances.

The XXXXX Peel-Away Introducers, and the Fast-Cath
Introducers are subject to tax under section 212.05(1)(a) 1. a.,
F.S., and Rule 12A-1.020(6)(b), F.A.C., as medical equipment
used in connection with medical treatment unless the purchaser
extends a properly executed resale and exemption certificate to
your company at the time of sale.

This response constitutes a Technical Assistance Advisement
under s. 213.22, F.S., which is binding on the department only
under the facts and circumstances described in the request for
this advice as specified in s. 213.22, F.S. Our response is
predicated on those facts and the specific situation summarized
above. You are advised that subsequent statutory or
administrative rule changes or judicial interpretations of the
statutes or rules upon which this advice is based may subject
similar future transactions to a different treatment than
expressed in this response.

You are further advised that this response and your request
are public records under Chapter 119, F.S., which are subject to
disclosure to the public under the conditions of s. 213.22, F.S.
Your name, address, and any other details which might lead to
identification of the taxpayer must be deleted by the Department
before disclosure. In an effort to protect the confidentiality
of such information, we request you notify the undersigned in
writing within 15 days of any deletions you wish made to the
request or the response.

Sincerely,

Richard S. Harrod
Technical Assistant

RSH/h
Control No. 13315