Kansas answers question of shipping charges to be included in tax base.

The Kansas Department of Revenue issued guidance in response to a recent question posed regarding how to collect tax on shipping charges related to taxable and non taxable goods. The Department stated that if a single shipment contains both taxable and nontaxable items, the seller must collect Retailer’s Sales Tax on the basis of the percentage of the shipping charge allocated to taxable goods in the shipment. The seller may allocate the shipping charge by (1) dividing the amount charged for the taxable goods by the total amount charged for all of the goods being shipped, or (2) dividing the weight of the taxable goods by the total weight of the shipment. The invoice provided by the seller must prove the allocation of the taxable versus nontaxable shipping charges. (Questions and Answers, Kansas Department of Revenue, December 10, 2004)

Posted on February 2, 2005