G. Temporary Use. Where an entrepreneur makes intermediate consumption of personal tangible property held for resale to a public authority on the basis of an order for the purchase of personal tangible property, the use constitutes a taxable provisional use, provided that the terms of the contract in question provide for the exploitation of the tangible property by the contractor and that such transaction coincides with the possession of such personal property. the asset is incompatible for resale. (a) a civil structure or other original works intended primarily for purposes other than commerce, industry or other undertakings or professions; (However, as of 1 April 2015, due to changes to the 2015 budget, this service is included in Communication No 6/2015 of 01.03.2015 taxable) Example 8: Contractor A enters into a facility management contract with a state authority, which provides for the supply of garbage bags. Contractor A assigns a work order to Subcontractor B to provide waste disposal services. Subcontractor B sends an order to Supplier C for a large quantity of garbage bags in order to fulfill the order. The purchase order submitted to Supplier C constitutes a purchase order within the meaning of subsection A of this article. Therefore, the True Object test must be applied at the task order level and not at the vendor order. Since the contract is an order for the provision of services, Subcontractor B must pay retail sales tax on the purchase of the garbage bags. 29,300 Scope of the paragraph. This subsection prescribes policies and procedures regarding the exemption or immunity of federal government purchases and real property from state and local taxes.
29,301 [Reserved] 29,302 Application of state and local taxes to government. (a) In general, purchases and leases of the federal government are exempt from state and local government tax. However, whether a particular purchase or lease is safe is a legal issue that requires the advice and assistance of the attorney appointed by the agency. (b) Where economically feasible, executive agencies shall make the best possible use of such national and local tax exemptions as may be available. If applicable, the Contractor will provide Standard Form 1094, a U.S. tax exemption form (see Part 53) or other evidence listed in paragraph 29.305(a) to prove that the purchase is made by the government. 29,303 Application of national and local taxes to State contractors and subcontractors. (a) As a general rule, prime contractors and subcontractors may not be designated as agents of the government to seek immunity from national or local sales or use taxes.
Before an activity claims that a contractor is a government official, the matter is referred back to the head of the agency for review. The reference includes all relevant data on which the claim is based, as well as a thorough analysis of all relevant precedents. (b) Where purchases are not made by the Government itself, but by a prime contractor or subcontractor under a main contract, the right to exemption of turnover from sales tax or use may not be based on exemption from direct taxes by States and places. Instead, it may be based on state or local regulations, or in some cases, the transaction may not be expressly exempt from tax. The interests of the Government are protected by the application of the procedures set out in section 29.101. (c) Often, immovable property (including immovable property acquired under the progressive payment clause of fixed-price contracts or the State ownership clause of repayment contracts) is owned by a contractor or subcontractor. Situations may arise when States or places claim the right to tax State property directly or to tax the ownership, interest or use of such property by the contractor or subcontractor. In such cases, the contract agent shall ask the legal adviser designated by the Agency for a review and advice on the appropriate course of action. 29,304 issues requiring special consideration. The collection of national and local taxes may result in special contractual considerations, including the following: (a) with the coordination of legal counsel appointed by the Agency, a contract may (1) stipulate that the contract price includes or excludes a particular tax, or (2) require the Contractor to take certain measures regarding payment, non-payment, the refund, contestation or any other treatment of a particular tax.
Such special treatment may be appropriate where there are doubts as to the applicability or imputability of the tax or where the applicability of the tax is being negotiated. (b) The applicability of national and local taxes to purchases made by the federal government may depend on the place and conditions of delivery. If the contract price is substantial, alternative locations and delivery terms should be considered, taking into account the possible tax consequences. (c) Indefinite supply contracts for the rental of equipment may require the contractor to supply equipment in each Of the States. Since the leased equipment remains the property of the contractor, states and local governments levy various ownership, use, or other taxes on the leased equipment to the government. The amount of these fees can vary greatly from one jurisdiction to another. See 29.401-1 for the limitation of the contractual clause to be included in contracts if the places of delivery are not known at the time of signing the contract. (d) State of North Carolina Sales and Use Tax and Local Purposes.
(1) The North Carolina Sales and Use Tax Act authorizes incorporated counties and towns to receive annually from the Commissioner of Revenue of the State of North Carolina a refund of sales and use taxes paid indirectly on building materials, supplies, furniture and equipment that are part of or attached to a building or structure constructed. modified or repaired for these incorporated counties and cities in North Carolina. In United States v. Clayton, 250 F. Supp. 827 (1965), it was found that the United States is entitled to the refund, but must follow the refund procedure of the Act and Regulations to claim what is due. (2) The Act provides that in order to receive the refund, the applicant must submit a written request within 6 months after the end of the applicant`s fiscal year, supported by records, receipts and information that the Revenue Commissioner may request. .