DES MOINES – Important changes to Iowa 's tax laws take effect July 1 and impact many Iowa businesses, according to the Iowa Department of Revenue. These changes include:
Delivery of tangible personal property by common carrier or through the post office
The local option tax rate at the destination will be applied instead of the rate where the post office is located or where the item is placed on the common carrier. Visit www.state.ia.us/tax for a list of local option jurisdictions and tax rates.
Tangible personal property for lease or rental
Any item purchased with the intent to be leased or rented will be exempt from sales tax as a purchase for resale. Sellers should obtain exemption certificates from buyers. Certificates are available on the department Web site, www.state.ia.us/tax.
Receipts from the lease or rental of tangible personal property
The sales tax on leased or rented property will be imposed in the jurisdiction where the property is located. If the property is moved to another jurisdiction, the source of taxation changes. (Note: This does not include vehicles subject to registration.)
If businesses sell any of the following, taxation changes:
Bottled water: Exempt. Taxable if purchased with a restaurant meal or if the water is flavored.
Candy: Taxable unless it contains flour (any type and any amount – soy, rice, wheat flours, etc.)
Chewing gum: Taxable
Soft drinks/juices: Taxable unless the product contains more than 50% vegetable or fruit juice
Vegetable seeds and plants, fruit trees: Taxable unless produce is for resale
Warehouse and distribution center refunds: A refund of sales tax will be given on racks, shelving and conveyor equipment for companies in an economic development area.
Manufacturing: Mold-making machinery, equipment, replacement parts and fuel to run equipment are exempt as well as the design and installation of the equipment.
If you have questions about Iowa taxes, or the changes taking place July 1, please contact The Iowa Department of Revenue at www.state.ia.us/tax, by e-mail at idrf@idrf.state.ia.us, or by phone, 515-281-3114 or 1-800-367-3388 ( Iowa only) Mon-Fri, 9 a.m. - 4:15 p.m. Get news and updates by e-mail by signing up for E-lists on the department's Web site.
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