Ezel / Tax Rulings / KS
KS Notice 96-0130 Kansas Retailers' Sales Tax 1996-01-30

Is tire retreading for interstate common carriers subject to Kansas sales tax?

Short answer: In this letter to the Kansas Tire Dealers Association, the Secretary of Revenue determined that the sale of retread tires to interstate common carriers is not subject to Kansas sales tax. Interstate common carriers enjoy a sales tax exemption for purchases of tangible personal property -- rolling stock such as buses and trailers, repair parts, replacement materials, and fuels consumed directly in interstate commerce. Although labor services to service, maintain, or repair rolling stock are normally taxable, the unique circumstances of tire retreading mean it should be viewed as the sale of tangible personal property (a retread tire) rather than the sale of a service. Absent a change in the law, the Department will hold assessments on these transactions in abeyance and not pursue them. This document carries no printed notice number; the Department indexes it as Notice 96-0130.

Apply this to your situation

This page answers the general question as of 1996. Ezel answers yours, under current Kansas tax law, with citations.

Currency note: this ruling is from 1996
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official Kansas Department of Revenue Notice providing general public guidance, not a private ruling issued to one taxpayer. It is a letter dated January 30, 1996 that carries no printed notice number (the Department indexes it as Notice 96-0130); later law and rates may change the result, so verify the current statute before relying on it. This summary is informational only and is not legal or tax advice.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page as a PDF) is the authoritative source for any reliance.
View original ruling (PDF)

Plain-English summary

In a January 30, 1996 letter to the Kansas Tire Dealers Association, the Secretary of Revenue (John D. LaFaver) decided the taxability of tire retreading for interstate common carriers.

  • Interstate common carriers have a sales tax exemption for tangible personal property -- rolling stock (buses, trailers), repair parts, replacement materials, and fuels immediately and directly consumed in interstate commerce.
  • Historically, labor services to service, maintain, or repair rolling stock are taxable like other taxable labor.
  • But because of the unique circumstances of tire retreading, the Department decided retreading is better viewed as the sale of tangible personal property (a retread tire) than as a service. So the sale of retread tires to interstate common carriers is not subject to Kansas sales tax.

Absent a law change, the Department will hold any assessments on these transactions in abeyance and not pursue them. The document carries no printed notice number (indexed as Notice 96-0130).

What this means for you

If you retread tires for interstate common carriers in Kansas, the Department treats those retread tires as exempt tangible personal property rather than a taxable repair service, so you do not charge Kansas sales tax on them. Confirm the position still holds, since it depends on the law in effect in 1996.

Common questions

Q: Are retread tires sold to interstate common carriers taxable in Kansas?
A: No. The Department treats the retread tire as tangible personal property covered by the interstate common carrier exemption, not as a taxable repair service.

Q: Does this treat retreading differently from other rolling-stock repairs?
A: Yes. Ordinary labor to service or repair rolling stock is taxable, but tire retreading is treated as the sale of tangible personal property because of its unique circumstances.

Citations and references

  • Kansas sales tax exemption for interstate common carriers (rolling stock, repair parts, and consumables used directly in interstate commerce)

Subject

Tire Retreading for Interstate Common Carriers

Source

Original ruling text

Notice
Notice Number:
Tax Type: Kansas Retailers' Sales Tax
Brief Description: Tire Retreading
Keywords:
Effective Date: 01/30/1996

Body:

                                                 January 30, 1996

Mr. Shawn Harrelson
Kansas Tire Dealers Association
201 NW Highway 24, Ste. 320
PO Box 8479
Topeka, KS 66608-0479

RE: Tire retreading

Dear Mr. Harrelson:

I want to take this opportunity to thank you for all the time and consideration you and others have given to me. The
information has proven to be persuasive regarding my decision as to the taxability of tire retreading for interstate
common carriers.

The sales tax exemption that the interstate common carriers enjoy in the state of Kansas is for the purchase of tangible
personal property, such as rolling stock, including busses and trailers, repair parts, replacement materials, gasoline,
distillate and other fuels that are immediately and directly consumed in interstate commerce.

Historically, the department has recognized the charges for labor services rendered to interstate common carriers for
the servicing, maintenance, or repairs of the rolling stock are taxable in the same manner as are sales of taxable labor
service to other firms, persons, or corporations. Based upon the unique circumstances of tire retreading, it appears that
tire retreading should not be looked upon as the sale of a service but as the sale of tangible personal property.
Therefore, the sale of retread tires to interstate common carriers is not subject to Kansas sales tax. Absent any change
in the law regarding the taxability of tire retreading, we will hold all assessments in abeyance and will not pursue
assessments on the above transactions. Based upon the information you have presented to me, the transactions
described above will not be subject to Kansas sales tax.

Sincerely,

John D. LaFaver
Secretary of Revenue

Date Composed: 12/12/1997 Date Modified: 10/10/2001

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