In a recent letter ruling dated June 27, 2025, the Missouri Department of Revenue (DOR) addressed the obligations of an out-of-state commercial roofing company. The ruling confirmed that paying sales tax on materials and equipment rentals and not charging tax to customers is consistent with Missouri law for a contractor.
The applicant is a commercial roofing contractor headquartered in Texas that periodically performs roofing projects in Missouri. When performing projects in Missouri, the contractor brings its own crews to perform the labor, purchases materials locally and pays Missouri tax, pays sales taxes on locally rented equipment, and does not charge Missouri customers sales tax on the job. The DOR confirmed that the applicant’s current practices are in full compliance with the state sales tax laws.
Under state regulation 12 CRS 10-112.010, contractors are considered the final users of construction materials used in real property improvements. Because these materials are not resold in taxable retail sales, contractors are responsible for paying the sales tax on their purchases. Additionally, the DOR clarified that a sales tax license is not required for contractors not making retail sales. There is no provision in Missouri law requiring a contractor purchasing tangible personal property or services to obtain a sales tax permit.
This letter ruling is binding on the Missouri Department of Revenue for three years from the date of issuance but only with respect to the applicant and based on the facts presented. If laws, interpretations, or practices change, the ruling may no longer apply. The ruling provides contractors working across states a straightforward interpretation of Missouri’s tax treatment of construction related activity. The department advises businesses to regularly review state rulings for relevance and accuracy.
(Letter Ruling No. LR 8360: Taxability of Roofing Materials Used by a Roofing Company, Missouri Department of Revenue, June 27, 2025)