Were charges to wash and sanitize the inside of liquid-food cargo tank trailers subject to Florida sales tax?

Subject

Washing Liquid Food Cargo Tank Trailers

Plain-English summary

The company's tank-trailer washing charge was not subject to sales tax. Soap, detergent, and bleach were used only as cleaning and sanitizing agents in a pressurized water and steam process; they did not leave a protective film or coating.

The company owed tax on its purchases of those cleaning supplies.

What this means for you

The ruling distinguishes a plain wash from a taxable wash that applies wax, silicone, or another protective coating.

Common questions

Was bleach treated as a taxable coating? No.

Did the cleaning company buy its supplies tax-free? No.

Would applying a protective film change the result? Yes.

Citations and references

• Fla. Stat. §§ 212.02(17), 212.05(1)(a)1.a., 212.08(7)(v)1., and 213.22
• Fla. Admin. Code r. 12A-1.006(16)(a)-(c)

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 94A-025

Original ruling text

Apr 25, 1994

Re: TAA 94A-025
Washing Liquid Food Cargo Tank Trailers
Sections 212.02(17), 212.05(1)(a)1.a., 212.08(7)(v)1., F.S.
Rule 12A-1.006(16)(a),(b), and (c), F.A.C.

Dear:

This is in response to your letter of March 18, 1994, and
our telephone conversation of March 28, 1994. In your letter,
you requested the issuance of a technical assistance advisement
on behalf of XXX (hereinafter "Company") as to the application
of tax when Company cleans and sanitizes the inside of liquid
food cargo tank trailers which are used to transport food and
other consumer products in interstate commerce.

Your letter provides in part:

"STATEMENT OF RELEVANT FACTS

"[Company] is a Florida corporation incorporated under the
laws of the State of Florida on July 1, 1992. The
[Company] is engaged in the business of washing tank
trailers used to transport food and other consumer products
in interstate commerce. The [Company's] sole business
consists of applying water, steam, soap/detergents, and
bleach (if necessary) for the purpose of cleaning and
sanitizing the inside of these tanks before they haul
another load of product. In no instance does the [Company]
ever apply products such as wax, silicone or any other type
of coating to the tanks. In addition to the fact that the
[Company's] competitors do not charge sales tax for their
services, the [Company] has tentatively been advised by its
accountants that its services appear to be exempt from
Florida State sales tax under Rule 12A-1.006(16) (See copy
attached as Exhibit A). Under this rule, the [Company] is
basically performing the same services as a car wash except
for commercial tankers. The water, detergent and bleach are

used solely for the performance of the wash job and are
taxable to the [Company] when purchased.

Since the [Company] does not apply any wax, silicone or any
other substance which would form any type of protective
film or coating, it would appear that the [Company] is
exempt from sales tax."

In our telephone conversation, it was clarified that the
tank trailers are brought to Company's place of business and are
washed with the use of a pressurized water/steam process.

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 212.02(17), F.S., provides:

"(17) Sales price' means the total amount paid for tangible personal property, including any services that are a part of the sale, valued in money, whether paid in money or otherwise, and includes any amount for which credit is given to the purchaser by the seller, without any deduction therefrom on account of the cost of the property sold, the cost of materials used, labor or service cost, interest charged, losses, or any other expense whatsoever.Sales
price' also includes the consideration for a transaction
which requires both labor and material to alter, remodel,

maintain, adjust, or repair tangible personal property.
Trade-ins or discounts allowed and taken at the time of
sale shall not be included within the purview of this
subsection."

Section 212.08(7)(v)1., F.S., provides:

"(v) Professional Services
"1. Also exempted are professional, insurance or personal
service transactions that involve sales as inconsequential
elements for which no separate charges are made."

Rule 12A-1.006(16)(a), (b), and (c), F.A.C., provides:

"(16)(a) The charge for a plain wash job, in which only
detergent or water softener is added to the water is
exempt. The purchase of detergents or water softeners for
use in the performance of the wash job is taxable to the
dealer.
"(b) The entire charge for a wash job, in which wax,
silicones, or any other substance is added that forms a
protective film or coating, is taxable. The purchase of
materials such as wax, silicones, and the like, which form
a protective film or coating, is exempt to the dealer. The
dealer shall extend a resale certificate to his supplier in
lieu of paying tax.
"(c) The purchase of machinery and equipment, parts and
accessories, soaps, brushes, or other supplies for
operation of a car wash facility is taxable to the dealer."

DEPARTMENT RESPONSE

Applying the above quoted sections of Chapter 212, F.S.,
and Rule of the Florida Administrative Code, to the facts as
presented in you letter, Company's charge for cleaning and
sanitizing the inside of liquid food cargo tank trailers by
applying soap/detergents and bleach by way of a pressurized
water/steam process is not subject to tax. The soap/detergents
and bleach act as cleaning agents and do not form a protective
film on the surface to which they are applied. However, the
purchase of these items by the Company is subject to tax.

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. 14546