Is hauling or transporting sand and gravel subject to Kansas retailers' sales tax when the hauler doesn't sell the material?

Plain-English summary

A hauler asked whether the transporting services it provides are subject to Kansas retailers' sales tax. The Department explained that Kansas taxes only enumerated services — the specific services the sales tax act lists — and that transporting is not one of them, so long as the hauler is not itself engaged in selling the gravel or sand it moves.

On that basis, the transporting services are not currently subject to Kansas sales tax. The Department added the standard caveat for a nontaxable-service provider: the hauler must pay sales tax on all articles of tangible personal property and all taxable services it purchases to provide those nontaxable services.

What this means for you

If you haul sand, gravel, or similar material for others in Kansas without selling the material, you generally do not charge sales tax on the hauling — but you do bear tax on your own inputs.

• Pure transporting is not a taxed enumerated service. You don't collect Kansas sales tax on the hauling charge.
• The "not selling the material" fact matters. The answer turns on the hauler not being engaged in the sale of the gravel or sand. If you sell the material and deliver it, the sale (and delivery charges tied to it) can be taxable.
• You pay tax on your inputs. As the final consumer, you owe sales or use tax on the trucks, parts, fuel-related taxable items, and taxable services you buy to run the business.
• "Not currently" is a real qualifier. The answer reflects the law as of the ruling; if the taxability of transporting changes, so could the answer.

Common questions

Is hauling or transporting sand taxable in Kansas?
No. The Department ruled that transporting services are not currently subject to Kansas sales tax, because Kansas taxes only enumerated services and the hauler here was not selling the material.

What if I also sell the sand or gravel I deliver?
Then you are making a taxable sale of tangible personal property, and the delivery can be taxed as part of that sale. This ruling addresses a hauler who does not sell the material.

Does the hauler owe any Kansas tax at all?
Yes — on its own purchases. It must pay sales or use tax on the tangible personal property and taxable services it buys to provide the hauling.

Can other haulers rely on this ruling?
Not directly. A private letter ruling binds the Department only for the requesting taxpayer and the stated facts; treat it as guidance.

Citations and references

• The ruling states that Kansas taxes only enumerated services, that transporting services are not currently taxed when the hauler is not selling the gravel or sand, and that the provider owes tax on its own taxable inputs; it does not cite a specific numbered statute.

Source

• Original ruling (DOCX): https://www.ksrevenue.gov/pildocs/rulings/P-1999-74.docx
• Kansas Policy Information Library: https://www.ksrevenue.gov/prpil.html

Original ruling text

Private Letter Ruling

Body:

Office of Policy & Research

March 8, 1999

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Dear Mr. TTTT:

We wish to acknowledge receipt of your letter dated March 4, 1999, regarding the application of Kansas Retailers’ Sales tax.

The state of Kansas taxes only enumerated services. The transporting services that you are providing are not currently subject to sales tax in the state of Kansas, since you are not engaged in the sale of gravel or sand. However, you must pay sales tax on all articles of tangible personal property and all taxable services purchased to provide the nontaxable services.

This is a private letter ruling pursuant to K.A.R. 92-19-59. It is based solely on the facts provided in your request. If it is determined that undisclosed facts were material or necessary to an accurate determination by the department, this ruling is null and void. This ruling will be revoked in the future by the operation of law without further department action if there is a change in the statutes, administrative regulations, or case law, or published revenue ruling, that materially effects this private letter ruling. If I may be of further assistance, please contact me at your earliest convenience at (785) 296-7776.

Sincerely yours,

Thomas P. Browne, Jr.
Tax Specialist

TPB

Date Composed: 03/29/1999 Date Modified: 10/11/2001

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