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In Kansas, the cleaning of kitchen exhaust systems is taxable because there was more involved than a simple cleaning or using a janitorial service. In fact, the service falls under the definition of a maintenance service which is taxable even if the tangible personal property becomes real property after installation or not. (Private Letter Ruling No. P-2003-020, Kansas Department of Revenue, April 14, 2003)


A web site design company asked for a private letter ruling whether the location of their server used for posting web pages had any taxability significance on their part. The Kansas Department of Revenue states that taxability of web site design is only affected when the design results in some form of canned or custom software being created and transferred. Canned and custom software is considered tangible personal property in the state of Kansas, so the customer's billing address will ultimately determine taxability rather than location of the server. (Department of Revenue Private Letter Ruling Nos. P-2003-002, P-2003-003 and P-2003-007)


Kansas has added more detailed regulations to its retailer's sales tax rules. These changes mostly deal with registering for certificates and the leasing of tangible personal property. As of August 23, 2002, every person required to collect Kansas sales tax must also obtain a sales tax registration certificate from the Department of Revenue (DOR). These certificates must be prominently displayed and only those who are directly issued the certificates may conduct business with them. For leases and rentals, the "time of incidence" will now be each payment period stated in the lease or rental agreement. Each payment period is constituted by a complete sale for sales tax purposes and the tax will be calculated over the total amount of each payment. Purchases by a lessor will be considered a purchase for resale and may be eligible for exempt status. Every retailer is responsible for collecting sales tax on retail items they sell. (Administrative Regulations 92-19 and 92-20, Kansas Department of Revenue, effective August 23, 2002)


Effective July 1, 2004, the state retailers' sales tax and compensating use tax rate will decrease from 5.3% to 5.2%. Effective July 1, 2005, that rate will again decrease to 5%. (State Law, Sec. 79-3603)


A ruling has been issued that ingredient and component parts that become a part of the finished product are exempt from tax. The exemption states that four criteria must be met, all concerning the integrality to the finished manufactured product, in order for the exemption to be given. (Office of Policy and Research, PLR P-2002-051)



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