Were a vendor's sales of disposable intrauterine monitoring catheters to Florida hospitals exempt from sales tax?

Subject

Taxable Status of Catheters

Plain-English summary

The vendor's sales of disposable intrauterine catheters to Florida hospitals were exempt from sales tax. The products were inserted during labor to monitor pressure and observe amniotic fluid, and the vendor sold them directly to hospitals.

Florida's rule specifically listed “catheters” among exempt prosthetic and orthopedic appliances. The Department said that listing was not restricted to a particular kind of catheter. Because the products were in fact catheters, the intrauterine design and disposable use did not remove them from the exemption.

What this means for you

The ruling depended on product classification rather than a narrow catheter subtype. Sellers should retain technical materials showing that the product is actually a catheter and verify the current statute, rule, and any documentation conditions before treating a sale as exempt.

Common questions

Q: Was the exemption limited to urinary or another named catheter type? No. The Department said the rule's catheter listing included all devices that were in fact catheters.

Q: Did the product's disposable design make it taxable? No. The ruling exempted the described disposable intrauterine devices.

Q: Who bought the products in this ruling? Florida hospitals purchased them directly from the vendor.

Citations and references

• Fla. Stat. § 212.08(2)(a) — medical products and prosthetic or orthopedic appliances
• Fla. Admin. Code r. 12A-1.021(1)(a)-(b) — definition and specific listing of catheters
• Fla. Stat. § 213.22 — Technical Assistance Advisements

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 98A-059

Original ruling text

SUMMARY

Discusses the taxable status of disposable intrauterine catheters. Section 212.08(2)(a), F.S., provides an exemption from tax for the sale of prosthetic and orthopedic appliance. Rule 12A-1.021(1)(b), F.A.C., states that the products listed therein are specifically exempt from tax. Catheters are included in this list. The specific exemption for catheters as seen in Rule 12A1.021(1)(b), F.A.C., is not limited to a certain type of catheter but includes all devices which are in fact catheters. Therefore, sales of intrauterine catheters to hospitals in this state are exempt from tax under section 212.08(2)(a), F.S., and Rule 12A-021(1)(b), F.A.C.

Aug 04, 1998

Re: Technical Assistance Advisement 98A-059 XXX ("Vendor") Sales and Use Tax; Taxable Status of Catheters Section 212.08(2), F.S. Rule 12A-1.021(1), F.A.C.

Dear :

This Technical Assistance Advisement is in response to your letter of June 8, 1998, in which you seek advice as to the taxable status of your XXX catheter product line. Your letter provides in pertinent part:

Our XXX of IUP catheters is a disposable catheter inserted in the uterus during labor to monitor pressures of the baby and amniotic fluid observation.

Our XXX products are approved for marketing by the Food & Drug Administration.... [Vendor] sells the XXX products directly to hospitals, copies of XXX brochures enclosed.

DISCUSSION

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 medical products and supplies or medicine dispensed 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, 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-1.021(1)(a), and (b), F.A.C., provides in part:

(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, which list shall be certified to the Department of Revenue from time to time. A list of prosthetic and orthopedic appliances (DR-46NT), 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, is available.... (b) The prosthetic and orthopedic appliances listed below are specifically exempt:... Catheters....

Section 212.08(2)(a), F.S., provides an exemption from tax for the sale of prosthetic and orthopedic appliances. Rule 12A-1.021(1)(b), F.A.C., states that the products listed therein are specifically exempt from tax. Catheters are included in this list. The specific exemption for catheters as seen in Rule 12A-1.021(1)(b), F.A.C., is not limited to a certain type of catheter but includes all devices which are in fact catheters. Therefore, your company's sales of intrauterine catheters to hospitals in this state are exempt from tax under section 212.08(2)(a), F.S., and Rule 12A-1.021(1)(b), F.A.C.

This response constitutes a Technical Assistance Advisement under s. 213.22, F.S. which is binding on the department only under 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 our 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,

Jonathan E. Swift
Tax Law Specialist
Technical Assistance and Dispute Resolution (850) 922-4840

Control #34505

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