When did Florida's 1999 mail-order rule exempt deliveries from county discretionary sales surtax?

Plain-English summary

Florida applied the specific 1999 mail-order statute instead of the general delivery rule when the two conflicted.

Orders sent by mail or other communication to the retailer's out-of-state store and delivered into a Florida surtax county were subject to Florida sales tax but exempt from the county surtax. The retailer was not located in a surtax county, and the orders were not placed through a dealer location in such a county, so section 212.0596(6)'s conditions for collecting local surtax were not met. The result stayed the same when the retailer's Florida store physically delivered the out-of-state store's mail order.

By contrast, a customer who placed the order in person at the out-of-state store did not make a statutory mail-order sale. Delivery into the surtax county then triggered county surtax under the general rule, whether the recipient was the buyer or a third party.

Orders placed through the Florida store were also outside the mail-order definition. The Florida store had to collect the destination county's surtax when it caused delivery there, even if the out-of-state store shipped the merchandise.

What this means for you

Multistate retailers

Document where and how each order is received. An out-of-state communication order and an in-person out-of-state purchase can have different county-surtax results even when both are delivered to the same Florida address.

Accountants and tax professionals

This ruling applies the statutes as they read in 1999. Its key interpretive point is that the more specific mail-order provision controlled the general county-delivery rule.

Common questions

Did Florida state sales tax still apply to the out-of-state mail orders? Yes. The TAA found the retailer had Florida nexus and required registration; only the local surtax was exempt on the qualifying mail orders.

Did an in-person purchase at the out-of-state store qualify as mail order? No. Delivery into the surtax county triggered the county tax.

What if the customer ordered through the Florida store? The Florida store had to collect surtax for delivery into the surtax county.

Citations and references

• Fla. Stat. §§ 212.054(2)(a), 212.054(3)
• Fla. Stat. § 212.055(2)
• Fla. Stat. § 212.0596(1), (6)
• Fla. Stat. § 212.06
• Fla. Admin. Code R. 12A-15.003(2)(a)3.
• Fla. Stat. § 213.22

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 99A-017

Original ruling text

SUMMARY

In transactions involving the imposition of discretionary
sales surtax, the provisions of s. 212.0596(6), F.S., which
was amended after, and is more specific than, s.
212.054(3)(a)1., F.S., will control when a conflict exits
between the two statutes.

Mail Order Sales/Discretionary Sales Surtax

Apr 16, 1999

Re: Technical Assistance Advisement- (TAA-99A-017)
Mail order sales and imposition of the discretionary sales
surtax
Section 212.054(2)(a), and (3), 212.055(2), 212.0596(1),
and (6), 212.06, F.S.
Rule 12A-15.003(2), and (2)(a)3., F.A.C.

Dear :

This communication, styled a Technical Assistance Advisement, is
a response to your letter dated XX. You described a series of
transactions between the XXX, which is incorporated in the XXX
but which also is registered to do business in XXX. The XXX is
engaged in the retail sale of jewelry through both the XXX and
its unincorporated division which is the XXX located in XXX.
The XXX is registered with the Department as a dealer. The XXX
location is not registered with the Department.

You describe six fact patterns in which sales and deliveries of
jewelry are made to purchasers in XXX and in XXX. You ask, in
all instances, whether the Florida county discretionary sales
surtax is applicable to these sales and deliveries.

Before answering these questions, a brief analysis is helpful as
to the provisions of s. 212.054(3)(a)1., F.S., and s.
212.0596(6), Florida Statutes. Section 212.054(3)(a)1., F.S.,

presently provides, in language made effective January 1, 1994,
by s. 2, Ch. 93-222, L.O.F., that the discretionary surtax is
imposed when a one-part test is satisfied, that is, when the
property has been delivered into a county imposing the tax.
However, s. 212.0596(6), F.S., added effective October 1, 1990,
by s. 84, Ch. 90-132, L.O.F., provides an exemption from the
discretionary sales surtax unless a four-part test is satisfied:
when the transaction is a mail order sale; the dealer is located
in a county imposing the discretionary sales surtax; the order
is placed through the dealer's location within that county; and,
either the property is delivered into that county or into
another county imposing the tax, then the mail order sale is
subject to the discretionary sales surtax. This subsection was
amended with no substantive change but solely for clarification
purposes, effective June 15, 1995, by s. 34, Ch. 95-280, Laws of
Florida.

A determination is made that the provisions of s. 212.0596(6),
F.S., control over those in s. 212.054(3)(a)1., Florida
Statutes. The basis for this conclusion is that the last
legislative expression, that being the amendment to s.
212.0596(6), F.S., effective June 15, 1995, will prevail in an
instance of statutory inconsistency or conflict. Askew v.
Schuster , 331 So.2d 297, 300 (Fla. 1976). Further, "... a more
specific statute covering a particular subject is controlling
over a statutory provision covering the same subject in more
general terms." Kiesel v. Graham , 388 So.2d 594, 595 (Fla. 1DCA
1980). Thus, s. 212.0596(6), F.S., a more specific statute,
controls over s. 212.054(3)(a)1., Florida Statutes.

Each of the fact patterns and questions will be replicated or
paraphrased, followed immediately by the response of the
Department.

Fact pattern 1. The New York Store accepts an order for
merchandise by mail or other means of communication from a
Florida resident located in Sarasota County. The New York Store
delivers the merchandise to the Florida resident in Sarasota
County.

Question 1. "Given the nature of the transaction and the import

of Section 212.0596(6) of the Florida Statutes, is New York
[Store] required to collect the local option surtax imposed by
Sarasota County when collecting the proceeds of the sale?"

Department Response

This transaction comes within the mail order provisions of s.
212.0596, Florida Statutes. This statute, in subsection (1),
defines a mail order sale, in part, as:

... a sale of tangible personal property, ordered by mail
or other means of communication, from a dealer who receives the
order in another state... and transports the property or causes
the property to be transported, whether or not by mail, from any
jurisdiction of the United States, including this state to a
person in this state, including the person who ordered the
property.

Sarasota County levies a local government infrastructure surtax
authorized under s. 212.055(2), Florida Statutes. The county
imposed surtax tax of 1 percent is levied on all sales which are
taxable under the state sales tax laws. Palm Beach County, the
Florida county in which Florida Store is located, does not levy
a discretionary sales surtax.

In that regard, s. 212.054(2)(a), F.S., defines the reach of the
tax as on:

... all transactions occurring in the county which
transactions are subject to the state sales tax imposed on
sales, use, services, rentals, admissions, and other
transactions by this chapter.

Section 212.054(3)(a)1., F.S., states that a transaction has
"occurred within a county" which imposes the discretionary sales
surtax, when:

[t]he sale includes an item of tangible personal
property... and the item of tangible personal property... is
delivered within the county.

Rule 12A-15.003(2), F.A.C., interprets the statute.

However, s. 212.0596(6), F.S., provides an exemption for mail
order sales in the following manner:

Notwithstanding other provisions of law, a dealer who makes
a mail order sale in this state is exempt from collecting and
remitting any local surtax on the sale, unless the dealer is
located in a county that imposes a surtax within the meaning of
s. 212.054(3)(a), the order is placed through the dealer's
location in such county, and the property purchased is delivered
into such county or into another county in this state that
levies the surtax, in which case the provisions of s.
212.054(3)(a) are applicable.

The term used in the statute, "local surtax," is construed to
include the discretionary sales surtax which is described in s.
212.055(2), F.S., as the "local government infrastructure
surtax."

Considering the fact pattern you have provided, the transaction
is a mail order sale. It is a transaction subject to Florida
sales tax because the New York Store has substantial nexus with
this state and should submit, to the Department, an application
for a sales tax registration number. It should indicate that it
is doing business in this state from a location outside this
state.

However, the exemption in s. 212.0596(6), F.S., cited above,
relieves the New York Store from collecting and remitting the
discretionary sales surtax on such transactions. Although the
transaction is a mail order sale, neither is the dealer located
in a county imposing the surtax, nor was the order placed
through the dealer's location in such county, as required in
subsection (6) of s. 212.0596, Florida Statutes. The Florida
Store is located, as indicated above, in Palm Beach County which
does not impose the discretionary sales surtax.

Fact pattern 2. The fact pattern is the same as in fact pattern
1 but, in this instance, the merchandise is to be delivered by
the Florida Store to the resident in Sarasota County.

Question 2. Is the New York Store required to collect the
discretionary sales surtax levied by Sarasota County?

Department Response

The answer is no. The sales tax would apply to the sale to the
resident of Sarasota County but the discretionary sales surtax
would not apply because, again, the dealer is not located in a
county imposing the surtax. Neither was the order placed through
the dealer's location in a county imposing the discretionary
sales surtax.

Fact pattern 3. A Florida resident, while in New York, places an
order for merchandise with the New York Store and asks that the
merchandise be delivered to the resident's address in Sarasota
County.

Question 3. Is the New York Store required to collect the
discretionary sales surtax at the time of sale in New York?

Department Response

This transaction is not a mail order sale because it is not a
sale, "... ordered by mail or other means of communication, from
a dealer who receives the order in another state...." Under the
facts presented by you, the purchaser placed the order while in
the New York Store. Consequently, the provisions of s.
212.0596(6), F.S., are not applicable.

However, the duty of the New York Store, as explained above, is
to register as a Florida dealer for the purposes of the
collection and remittance of the Florida sales tax. Having
become a registered Florida dealer, the New York Store would be
obligated to collect the discretionary sales surtax applicable
to any Florida county imposing the tax. This would include
Sarasota County which levies a 1 percent discretionary sales
surtax.

Rule 12A-15.003(2)(a)3., F.A.C., states that "[i]f the selling
dealer is not located in a county imposing the surtax, including

out-of-state dealers, and delivery of tangible personal
property... is made to a location within a county imposing the
surtax, the selling dealer is required to collect the surtax at
the rate imposed in the county where the tangible personal
property... [is] delivered."

Fact pattern 4. The facts are the same as in fact pattern 3,
except that the Sarasota County purchaser, while in New York
buying the merchandise from the New York Store, asks that the
merchandise be delivered to a third party at an address in
Sarasota County.

Question 4. Is the New York Store required to collect the
discretionary sales surtax at the time of sale in New York?

Department Response

As in the response to question 3, the provisions of Rule 12A15.003(2)(a)3., F.A.C., are applicable because the delivery is
made "... to a location within a county imposing the surtax... "

Fact Pattern 5.

A New York resident, while in the New York Store, purchases
merchandise and orders that it be shipped to a third party at a
location in Sarasota County.

Question 5. Is the New York Store required to collect the
discretionary surtax imposed by Sarasota County?

Department Response

Again, as described in the response to question 3, the
transaction is not a mail order sale. Thus, s. 212.0596, F.S.,
is not applicable. Rather, the provisions of s. 212.054, F.S.,
and Rule 12A-15.003, F.A.C, apply. Rule 12A-15.003(2)(a)3.,
F.A.C., as cited above, states the liability of the New York
Store to collect the discretionary sales surtax of 1 percent
which is imposed by Sarasota County.

Fact Pattern 6. A Florida resident in Sarasota County places an

order through the Florida Store which is then communicated to
the New York Store. The merchandise is shipped from the New York
Store to the address in Sarasota County.

Question 6. Which store, if any, is required to collect the
discretionary sales tax imposed by Sarasota County?

Department Response

The mail order sale statute, s. 212.0596, F.S., is not
applicable to this transaction because the order was not
received in another state, or another location, as specified in
the statute. Thus, the provisions of s. 212.054, F.S., and Rule
12A-1.15.003, F.A.C., are again applicable. Here, it appears
that the purchase was made at the location of the Florida Store.
The merchandise was delivered to the Sarasota County address
from the New York Store.

As cited above, the provisions of 12A-15.003(2)(a)3., F.A.C.,
are applicable. The Florida Store, which is the dealer that made
the sale, although not located in a county imposing the
discretionary sales surtax, does cause the delivery of the
merchandise to Sarasota County. That county imposes the tax.
Thus, the delivery occurred in Sarasota County and the sale is
subject to the Sarasota County discretionary sales surtax of 1
percent.

You also ask within this fact pattern if the Sarasota County
discretionary sales surtax would be applicable if the
merchandise were shipped directly to the Florida Store from the
New York Store, and the Florida Store caused the delivery of the
merchandise to the address in Sarasota County.

The response to this changed fact pattern is the same as
immediately provided above. That is, the transaction is not a
mail order sale. Thus, the provisions of Rule 12A-15.003, F.S.,
are applicable. Consequently, the Florida Store would be
required to collect the discretionary sales surtax imposed by
Sarasota County because the delivery of the merchandise would
occur in that county.

You close by requesting assistance of the Department as to the
"... `point of delivery' guidelines delineated in Section
212.054(3)(a) of the Florida Statutes where goods are shipped
[by the Florida Store] to points within Florida." In response
to that request, a complete copy of Rule 12A-15.003, F.A.C., is
attached.

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,

Robert G. Parsons
Tax Law Specialist
Technical Assistance and Dispute Resolution

enclosure:
Ctrl. No. 35793