How did Florida's 1994 dry-cleaning gross receipts tax apply to a drapery business that subcontracted cleaning?

Subject

Gross Receipts Tax on Dry-cleaning

Plain-English summary

Under the law in effect in 1994, the drapery business owed the 1.5% gross receipts tax on all customer charges for dry-cleaning or laundering draperies, even though another business performed the cleaning. It also had to register and pay the stated $30 registration fee.

Separately stated services that were neither dry-cleaning nor laundering, such as taking down and rehanging draperies, were outside the tax. The ruling allowed the company to give its cleaning subcontractor a resale certificate so that the subcontractor's charge was exempt.

The official status notice says the resale exemption was repealed effective October 1, 1995 by Chapter 95-239 and refers readers to TIP 95B-11017. That portion of the 1994 result is historical only.

What this means for you

This page documents a repealed-era tax rule. It is useful for historical periods, but the subcontractor resale treatment cannot be carried forward beyond the official repeal date.

Common questions

Were drapery cleaning charges taxable? Yes, at the 1.5% rate stated in the ruling.

Were take-down and re-hang services taxable? Not when separately stated.

Could the business use a resale certificate for subcontracted cleaning? The 1994 ruling said yes, but the official notice says that exemption ended October 1, 1995.

Citations and references

• Fla. Stat. § 376.70, as applied in the 1994 advisement
• Chapter 95-239, Laws of Florida, as identified in the official status notice
• Fla. Stat. § 213.22

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 94B11-001

Original ruling text

Status: Law Repealed the resale exemption effective 10-1-95 by
Ch. 95-239, L.O.F.; also see TIP 95B-11017

Nov 29, 1994

RE: TAA 94(B)11-001
Gross Receipts Tax on Dry-cleaning
Section 376.70, F.S.

Dear :

This is in response to your letter of October 6, 1994,
wherein you requested a Technical Assistance Advisement for the
purpose of determining XXX (Herein after referred to as Company
A) liability for the Florida Gross Receipts Tax on Dry-cleaning.

PERTINENT FACTS

Company A provides to customers the service of dry-cleaning
and laundering of draperies. Other services provided by your
business include steam pressing, take down, and re-hang service.
The dry-cleaning service is sub-contracted and no dry-cleaning
solvents are used on the premises.

IMPLEMENTATION OF THE TAX

Beginning October 1, 1994 a gross receipts tax was levied,
on the business of dry-cleaning or laundering of clothes or
other fabrics and for providing uniform rentals or linen supply
services in the State of Florida. The tax rate is 1.5 percent
on all charges imposed for dry-cleaning or laundering clothing
and other fabrics, coin-operated dry-cleaning machines, uniform
rental or, linen supply services. Dry-cleaning facilities and
dry drop-off facilities who impose charges for dry-cleaning or
laundering of clothing and other fabrics must register with the
Department of Revenue, the fee for registration is $30. The
gross receipts tax on dry-cleaning does not apply to any nondrycleaning or nonlaundry services provided by businesses subject
to the tax. For example, the gross receipts tax on dry-cleaning

would not apply to take down or re-hang services. Businesses
subject to the tax may, at their option, separately state the
tax on the customer's bill or invoice. A resale certificate may
be issued on transactions where the taxable service is being
sub-contracted to another business.

CONCLUSION

Company A would be subject to the gross receipts tax on
dry-cleaning. Company A would be required to complete the
Application for Gross Receipts Tax on Dry-cleaning (DR-1DC) and
remit the $30 registration fee. The nondry-cleaning/nonlaundry
services provided would not be subject to the gross receipts tax
on dry-cleaning, if stated separately on the customer's bill or
invoice. Company A could issue a resale certificate to the subcontractor that provides the dry-cleaning services to exempt the
charge by the sub-contractor to Company A for the dry-cleaning
services from the gross receipts tax on dry-cleaning. All
charges imposed on customers by Company A for the services of
dry-cleaning or laundering draperies would be subject to the
gross receipts tax on dry-cleaning.

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
based 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. Please note that we already have in
file some documents evincing some desired deletions.

Sincerely,

Alan R. Fulton
Tax Audit Specialist III
Statutory Compliance Section

ARF
Ctrl No. 17907
Enclosure: (Not Attached)