Were U.S. online purchases sent to related Florida courier and export companies for foreign delivery exempt from Florida sales tax?

Plain-English summary

Florida treated online purchases sent to two related Florida courier and export companies for delivery to foreign customers as exempt export sales.

Both companies were licensed exporters operating from the same building, and one was an indirect air carrier with airline contracts. U.S. vendors sent the foreign customers' purchases to one company, which transferred packages daily to the other for overseas shipment.

The exemption required commitment to export at the time of sale, a continuous and unbroken process, no direct or indirect U.S. customer pickup, and records available for Department inspection. Routine recording, inspection, processing, temporary retention, carrier transfer, and certain returns did not interrupt export on the stated facts.

What this means for you

Online sellers

Confirm that the Florida recipient is genuinely in the business of exporting and that the sales arrangement prevents domestic diversion.

Courier and export businesses

Keep carrier receipts, bills of lading, customs declarations, destination records, and other documents tracing each package outside the United States.

Common questions

Did third-party sellers have to collect Florida tax? No, when every export condition was met.

Could a foreign customer pick up the goods in Florida? No.

Could ordinary export processing occur in Florida? Yes, without breaking the process on these facts.

Citations and references

• Fla. Stat. Sec. 212.06(5)(a)1.
• Fla. Admin. Code R. 12A-1.0015

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 20A-011

Original ruling text

QUESTION:
What is required of a licensed exporter who will receive product for shipment for export
outside of the United States to satisfy the exclusion for export sales.
ANSWER:
The licensed exporter must be in the business of receiving product and preparing it for export
outside of the United States. All requirements provided for by s. 212.06(5), F.S., and Rule 12A1.0015, F.A.C., regarding documentation and other procedures must be satisfied.

May 29, 2020
XXXXXX
XXXXXX
XXXXXX
Re:

Technical Assistance Advisement No. 20A-011
AMS #: 7000339192
Sales and Use Tax
Exports
Sections 212.06, Florida Statutes (“F.S.”)
Rule 12A-1.0015, Florida Administrative Code (“F.A.C.”)
XXXXXX
Business Partner Number: XXXXXXX
FEIN: XX-XXXXXXX
XXXXXXX
Business Partner Number: XXXX
FEIN: XX-XXXXXXX

Dear XXXXX:
This is in response to your request received January 24, 2020, for a Technical Assistance Advisement
(TAA) pursuant to s. 213.22, F.S., and Rule Chapter 12-11, Florida Administrative Code (F.A.C.),
regarding certain exports. An examination of your letter has established that you have complied with

Florida Department of Revenue
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the statutory and regulatory requirements for issuance of a TAA. Therefore, the Department is
hereby granting your request for a TAA.
ISSUE
Whether shipments made by third party vendors to XXXX and XXX, intended to be exported outside
of the United States by XXXXXX and XXXXX, qualify as exports for purposes of section 212.06(5)(a),
Florida Statutes (“F.S.”) and Rule 12A-1.0015, Florida Administrative Code (“F.A.C.”)
FACTS
XXXX and XXXX are related parties, the owner of XXXX is a part owner of XXXX. Both companies have
a NAICS Code of 492110 and are licensed exporters that operate out of the same building in south
Florida. XXXX is licensed as an Indirect Air Carrier to export cargo outside of the United States and
has contracts with different airlines to export the cargo.
XXXX and XXXX provide courier and delivery services to their customers in XXXXXX. Their customers
make online purchases from vendors within the United States to be delivered outside of the United
States, specifically to countries in XXXXXX. Merchandise is shipped by the online vendors to XXXX.
Everyday XXXX delivers the merchandise to Zoom to be shipped overseas to their customers.
REQUESTED RULINGS
You would like to know what the requirements are for sales to be considered for export when
received by XXXX and XXXXXXX, at the same location, to be reshipped, or exported, outside of the
United States.
LAW AND DISCUSSION
Section 212.06(5)(a)l, F.S., provides:
(5)(a)1. Except as provided in subparagraph 2., it is not the intention of this chapter
to levy a tax upon tangible personal property imported, produced, or manufactured
in this state for export, provided that tangible personal property may not be
considered as being imported, produced, or manufactured for export unless the
importer, producer, or manufacturer delivers the same to a licensed exporter for
exporting or to a common carrier for shipment outside the state or mails the same by
United States mail to a destination outside the state; or, in the case of aircraft being
exported under their own power to a destination outside the continental limits of the
United States, by submission to the department of a duly signed and validated United
States customs declaration, showing the departure of the aircraft from the
continental United States; and further with respect to aircraft, the canceled United
States registry of said aircraft; or in the case of parts and equipment installed on
aircraft of foreign registry, by submission to the department of documentation, the
extent of which shall be provided by rule, showing the departure of the aircraft from
the continental United States; nor is it the intention of this chapter to levy a tax on

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any sale which the state is prohibited from taxing under the Constitution or laws of
the United States. Every retail sale made to a person physically present at the time of
sale shall be presumed to have been delivered in this state.
Rule 12A-1.0015, F.A.C., provides in part, the following:
(1) Scope.
(a) Tangible personal property imported, produced, or manufactured in this state for
export, as provided in Section 212.06(5)(a)1., F.S., is not subject to Florida sales tax
when the importer, producer, or manufacturer delivers the property to a licensed
exporter for export outside Florida or to a common carrier for shipment outside
Florida, or mails the property by United States mail to a destination outside Florida.
This rule is intended to provide tax guidelines for the sale of tangible personal
property for the purposes of export from Florida.

(2) Sales of property irrevocably committed to exportation.
(a) A dealer is required to collect tax on sales of tangible personal property when the
property is delivered to the purchaser or the purchaser’s representative in Florida,
whether the disclosed or undisclosed intention of the purchaser is to transport the
property to a location outside Florida, or whether the property is actually so
transported. Every sale of tangible personal property to a person physically present
at the time of sale is presumed to have been delivered in Florida.
(b) When a dealer sells tangible personal property, commits the property to the
exportation process at the time of sale, and the exportation process remains
continuous and unbroken until the property is exported from Florida, the dealer is not
required to collect tax. The intent of the seller and the purchaser to export the
property is not sufficient to establish that the property is not subject to tax in Florida.
The delivery of the property to a location in Florida for subsequent export from Florida
is insufficient to establish documentary evidence that the property sold was
irrevocably committed to the exportation process. The following are examples of
methods to commit the property to the exportation process at the time of sale:

1. The dealer is required by the terms of the sale contract to deliver the property
   outside Florida using the dealer’s own mode of transportation;
2. The dealer is required by the terms of the sale contract to mail the property by
   United States mail to a destination located outside Florida; or
3. The dealer is required by the terms of the sale contract to deliver the property to a
   carrier, licensed customs broker, or forwarding agent for final and certain movement
   of the property to a destination located outside Florida.
   a. The term “carrier” means a person regularly engaged in the business of transporting
   tangible personal property owned by other persons for compensation. The term
   “carrier” includes common carriers and contract carriers.
   b. The term “licensed customs broker” means a person licensed by the United States
   customs service to act as a custom house broker.
   c. The term “forwarding agent” means a person regularly engaged in the business of
   preparing property for shipment or arranging for its shipment for compensation.

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d. Any person not engaged in the business of receiving tangible personal property
owned by other persons and shipping or arranging for shipping for compensation
does not become a carrier or forwarding agent by being designated by the purchaser
to receive and ship goods to a point outside Florida.

(d) A dealer who imports taxable tangible personal property into Florida for
exportation from Florida is required to maintain documentation that the imported
property was irrevocably committed to the exportation process at the time of
importation and that the exportation process was continuous and unbroken while
such property was within Florida.
Florida law provides that every person is exercising a taxable privilege who engages in the business
of selling tangible personal property at retail in Florida. Retail sales of tangible personal property are
subject to tax, unless specifically exempt by Chapter 212, F.S. See s. 212.05(1)(a)1.a., F.S. Sales for
export are excluded from the tax imposed by s. 212.05, F.S. Shipments for export are presumed not
to be excluded from the tax, but this presumption may be rebutted by the exporter. See Great Lakes
Dredge & Dock Company v. Department of Revenue, 381 So.2d 1078 (Fla. 1st DCA 1979). Third party
companies facilitating export transactions must be in the business of exporting for the presumption
to apply. The contracts between the seller and exporter must be as such so that the product may not
be diverted from the exportation process.
As licensed exporters and indirect air carriers, XXXX and XXXX will be required to commit all property
shipped to the facility to the exportation process, and the exportation process must remain
continuous and unbroken until the property is exported from Florida to foreign customers. The
statute and rule provide the exemption applies when, by the terms of the sales contract, the goods
are delivered:
▪ to a licensed exporter for exporting;
▪ to a common carrier or forwarding agent for shipment outside Florida;
▪ to the U.S. mail for mailing to a destination outside Florida; or
▪ using its own mode of transportation to a destination outside Florida.
To enjoy the protection of the export exemption, XXXXX and XXXX are required to keep sufficient
records, available for inspection by the Department, that will document that the items are exported
outside Florida in a continuous and unbroken exportation process. Examples of records to document
sales for export to points outside Florida include common carriers’ receipts, bills of lading, customs
declaration of export, or similar documentation that evidences the delivery destination, receipts from
a licensed customs broker, and proof of export signed by a customs officer. The foreign customers
may not be allowed to pick up directly or indirectly the products at the location of XXXXXX or XXXXX,
or anywhere else within the United States.
When products shipped by a third-party dealer to XXXXXX and XXXXX, which are committed to the
exportation process at the time of sale, and the exportation process remains continuous and
unbroken until the property is exported from Florida, the third-party dealer is not required to collect
Florida sales tax.

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The following activities will not be presumed as intervening events which would defeat the exempt
status of the export transactions: the recordation of information pertaining to the products in the
systems of XXXXX and XXXX; the inspection and related processing of the products for purposes of
assuring their conformity to the orders placed by foreign consumers, and preparing them for
shipment to foreign destinations; the transfer of the products from XXXX and XXXX to carriers for
shipment to foreign destinations; the return of a product to an third-party dealer due to nonpayment
by the foreign consumer, or the inability to effect delivery to the foreign consumer; any act
reasonably necessary to comply with the laws and regulations governing the exportation of property
from the United States to foreign destinations and/or foreign recipients; and the temporary retention
of the products at XXXX or XXXXX for purposes of accomplishing the foregoing tasks.

RESPONSE
Products shipped by a third-party dealer to XXXXXX and XXXX, which are committed to the
exportation process at the time of sale, and the exportation process remains continuous and
unbroken until the property is exported from Florida, are exempt from Florida sales tax, and the thirdparty dealer is not required to collect Florida sales tax. 1
This response constitutes a Technical Assistance Advisement under s. 213.22, F.S., which is binding
on the Department only under the facts and circumstances described in the request for this advice
as specified in s. 213.22, F.S. Our response is predicated on those facts and the specific situation
summarized above. You are advised that subsequent statutory or administrative rule changes, or
judicial interpretations of the statutes or rules, upon which this advice is based, may subject similar
future transactions to a different treatment than expressed in this response.
You are further advised that this response, your request and related documents are public records
under Chapter 119, F.S., which are subject to disclosure to the public under the conditions of s.
213.22, F.S. Your name, address, and any other details, which might lead to identification of the
taxpayer, must be deleted before disclosure.

The Department recognizes that there may be activities that the Taxpayer conducts as part of the
exportation process (e.g., the recordation of information pertaining to the products being moved; the
inspection and related processing of the products for purposes of assuring their conformity to the
orders placed by foreign consumers, and preparing them for shipment to foreign destinations; the
purchase of insurance against loss or damage during shipment; the return of a product to a thirdparty dealer due to nonpayment by the foreign consumer, or the inability to effect delivery to the
foreign consumer; any act reasonably necessary to comply with the laws and regulations governing
the exportation of property from the United States to foreign destinations and/or foreign recipients;
and the temporary retention of the products by the Taxpayer for purposes of accomplishing the
foregoing tasks). The Taxpayer will need to retain documentation to allow the Department to verify
that these events were part of the continuous and unbroken exportation process.
1

Florida Department of Revenue
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In an effort to protect the confidentiality of such information, we request you provide the
undersigned with an edited copy of your request for Technical Assistance Advisement, backup
material and response within fifteen days of the date of this advisement.
Sincerely,

Chuck Wallace

Chuck Wallace
Conferee
Technical Assistance and Dispute Resolution
Record ID: 339192