KS Notice 95-05 Dry Cleaning Environmental Surcharge; Dry Cleaning Solvent Fee 1995-06-02

What dry cleaning environmental surcharge and solvent fee did Kansas start charging on July 1, 1995?

Short answer: Beginning July 1, 1995, the Kansas Dry Cleaner Environmental Response Act required dry cleaning and laundry retailers to collect an environmental surcharge of 2% of gross receipts from dry cleaning or laundering services and remit it separately from sales tax. The surcharge does not apply to coin-operated services, to commercial laundering/rental of uniforms, linens, and other textiles cleaned without solvents, or to services purchased directly by exempt groups (federal/state government, schools, nonprofit hospitals, etc.); it does apply to solvent-cleaned items for both individuals and businesses. Separately, businesses that use dry cleaning solvents must remit a solvent fee: $3.50 per gallon for perchloroethylene and other chlorinated solvents (rising $.25 each year beginning January 1, 1996 up to a $5.50 maximum), and 10% of the chlorinated rate for petroleum-based solvents. Both amounts are reported on a separate environmental surcharge and solvent fee form (not the sales tax return), due the 25th of the following month, even if none was collected. A June 15, 1995 supplement clarified the exempt-service list. (The 1999 Legislature later raised the surcharge to 2.5% -- see Notice 99-10.)

Apply this to your situation

This page answers the general question as of 1995. Ezel answers yours, under current Kansas tax law, with citations.

Disclaimer: This is an official Kansas Department of Revenue Notice providing general public guidance, not a private ruling issued to one taxpayer. It describes 1995 law as it stood then; later law and rates may change the result, so verify the current statute before relying on it. This summary is informational only and is not legal or tax advice.

About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page as a PDF) is the authoritative source for any reliance.

View original ruling (PDF)

Plain-English summary

This notice explains the two charges the Kansas Dry Cleaner Environmental Response Act imposes beginning July 1, 1995.

Environmental surcharge -- 2% of gross receipts from dry cleaning or laundering services, collected from the customer and remitted separately from sales tax. It does not apply to:

coin-operated services;
commercial laundering/rental of uniforms, linens, dust-control materials, and other textiles cleaned without solvents; and
services purchased directly by exempt groups (federal government, State of Kansas and its subdivisions, schools, nonprofit hospitals, blood/tissue/organ banks, 501(c)(3) historical societies and museums, public broadcasting).

It does apply to solvent-cleaned items for both individuals (shirts, jeans) and businesses (uniforms, tuxedos). Sales for resale to registered businesses need a dry cleaning exemption certificate.

Solvent fee -- for businesses that use dry cleaning solvents:

Chlorinated solvents (perchloroethylene, etc.): $3.50 per gallon, rising $.25 each year from January 1, 1996 up to a $5.50 maximum (fractions prorated).
Petroleum-based solvents: 10% of the chlorinated rate (so $.35 when chlorinated is $3.50).

Both are reported on a separate surcharge/solvent-fee form (not the sales tax return), filed when the sales tax return is filed and due by the 25th of the following month, even if nothing was collected. A June 15, 1995 supplement clarified the exempt-service list. The 1999 Legislature later raised the surcharge to 2.5% (see Notice 99-10).

What this means for you

If you run a Kansas dry cleaner or laundry, from July 1, 1995 you must collect the 2% environmental surcharge on solvent-cleaned items and, if you use solvents, pay the per-gallon solvent fee -- both reported on a form separate from your sales tax return. Confirm current rates, since the surcharge and solvent-fee amounts have changed over time.

Common questions

Q: What is the Kansas dry cleaning environmental surcharge?
A: 2% of gross receipts from dry cleaning or laundering services (solvent-cleaned items), collected from the customer starting July 1, 1995 and remitted separately from sales tax.

Q: How much is the solvent fee?
A: $3.50 per gallon for chlorinated solvents like perchloroethylene (rising $0.25/year from 1996 to a $5.50 cap), and 10% of that rate for petroleum-based solvents.

Citations and references

Kansas Dry Cleaner Environmental Response Act (environmental surcharge and solvent fee)

Subject

Dry Cleaning Environmental Surcharge and Solvent Fee

Source

Landing page: Kansas Department of Revenue Policy Information Library
Original document: Notice 95-05

Original ruling text

Notice
Notice Number: 95-05
Tax Type: Dry Cleaning Environmental Surcharge; Dry Cleaning Solvent Fee
Brief Description: Dry Cleaning Environmental Surcharge and Solvent Fee
Keywords:
Effective Date: 07/01/1995

Body:

                                          STATE OF KANSAS
                                                    BILL GRAVES, GOVERNOR

Wayne C. Vennard, Jr., Director (913) 296-0222
915 SW Harrison Street FAX (913) 291-3614
Topeka, Kansas 66625-0001
Department of Revenue
JOHN D. LaFAVER, SECRETARY
Taxpayer Assistance Bureau

The Kansas Dry Cleaner Environmental Response Act establishes an environmental surcharge and solvent fee. These instructions
should help you collect and remit the surcharge and fee.

DRY CLEANING ENVIRONMENTAL SURCHARGE

Dry cleaning and laundry retailers are required to collect the environmental surcharge from the consumer and remit it to the Kansas
Department of Revenue beginning July 1, 1995. The surcharge is 2% of gross receipts from dry cleaning or laundering services. Dry
cleaners and launderers should keep separate records of the surcharge and sales tax. The Kansas Department of Revenue provides
separate forms to report the surcharge and tax.

EXEMPT SERVICES

        The surcharge does not have to be collected for these services:

        -   Services provided to the public through coin-operated devices

        - Laundering and rentals of uniforms, linens, dust control materials, and other textiles for commercial purposes that are
        cleaned without using dry cleaning solvents. NOTE: Dry cleaners and launderers must collect the surcharge on all items
        cleaned with the use of solvents for individual consumers including, but not limited to, shirts, jeans, and fatigues. Dry
        cleaners and launderers must also collect the surcharge on all items cleaned with the use of solvents for businesses
        including, but not limited to, uniforms and tuxedos.

        -   Laundering or dry cleaning services purchased directly by groups that do not pay sales tax, including:

      Federal government State of Kansas and its political subdivisions
      Elementary and secondary schools Nonprofit educational institutions
      Nonprofit hospitals Nonprofit blood, tissue, and organ banks
      Nonprofit 501(c)(3) historical societies Noncommercial educational television and
      Nonprofit 501(c)(3) museums radio stations
  SALES FOR RESALE
      Dry cleaners and launderers occasionally make sales for resale to hotels and other businesses registered for the
      environmental surcharge. Retailers that make such sales must obtain a dry cleaning exemption certificate from the
      business indicating the business will collect and remit the surcharge. For businesses not registered, dry cleaners and
      launderers must collect and remit the surcharge.

        Dry cleaning resale exemption certificates are available upon request by writing to the Taxpayer Assistance Bureau,
        Kansas Department of Revenue, 915 SW Harrison St., Topeka, Kansas, 66625-0001.

Page 2

DRY CLEANING SOLVENT FEE

Businesses that use dry cleaning solvents are required to remit a solvent fee beginning July 1, 1995.

CHLORINATED SOLVENTS
The fee rate is $3.50 per gallon for Perchloroethylene and other chlorinated solvents. The rate on less than one gallon is
calculated on the amount purchased. For example, the fee for a gallon of Perchloroethylene is $3.50. The fee for a half
gallon is $1.75.

  Beginning January 1, 1996, the rate for chlorinated solvents will go up $.25. There will be a $.25 increase each year
  until the rate reaches its maximum of $5.50 per gallon.
                                                        (more)

PETROLEUM BASED
The fee rate for petroleum based solvents is 10% of the rate for chlorinated solvents. For example, if the chlorinated
solvent is $3.50, the fee rate for petroleum solvents is $.35. Again, the rate on less than one gallon is calculated on the
amount purchased. For example, the rate for a half gallon of any nonchlorinated dry cleaning solvent is $.18.

Next year, the fee rate for chlorinated solvents will increase to $3.75. As a result, next year's fee rate for petroleum solvents
will be $.38.

REGISTRATION

Dry cleaners and launderers currently registered for retailers' sales tax have been automatically registered for the
environmental surcharge and solvent fee. All satellite locations that complete sales tax returns for dry cleaning services will
also need to be registered. Send the Department of Revenue a list of those locations, using the enclosed application form.
NOTE: Drop off and pick up locations ("dry" stores) which collect money in the name of the dry cleaner or laundry retailer, do
not need to be registered. Dry cleaners and laundry retailers must remit the environmental surcharge collected by the "dry"
store.

FORMS

An environmental surcharge and solvent fee form will be mailed to registered dry cleaners and laundry retailers during the
final week of the reporting period. DO NOT use the retailers' sales tax return to report the environmental surcharge or
the solvent fee. File this new form when the retailer's sales tax return is filed. For example, a dry cleaning facility that files
monthly sales tax returns will also file monthly surcharge and solvent fee forms. Both returns are due no later than the 25th of
the month following the end of the reporting period. Forms must be filed even if no surcharge or solvent fee is collected.
Failure to file the form and remit the surcharge and fee by the due date will result in penalties and interest.

If you have questions regarding this notice or need assistance in completing the forms, please call (913) 296-0222 or write to
the Taxpayer Assistance Bureau, Kansas Department of Revenue, 915 SW Harrison St., Topeka, Kansas, 66625-0001.

NOTICE 95-05 (6/2/95)
TO: Dry Cleaners and Laundry Retailers
RE: Dry Cleaning Environmental Surcharge
and Solvent Fee

The Kansas Department of Revenue issued a notice June 2, 1995, explaining the impact of the Kansas Dry Cleaner
Environmental Response Act on the dry cleaning industry. This supplement makes clear one of the exempt services.

DRY CLEANING ENVIRONMENTAL SURCHARGE

Dry cleaning and laundry retailers are required to collect an environmental surcharge from the consumer and remit it to the
Kansas Department of Revenue beginning July 1, 1995. The surcharge is 2% of gross receipts from all dry cleaning and all
laundering services. Dry cleaners and launderers should keep separate records of the surcharge and sales tax. The Department
of Revenue provides separate forms to report the surcharge and tax.

Page 3

 EXEMPT SERVICES
     The surcharge does not have to be collected for this service:
           Laundering and rentals of uniforms, linens, dust control materials, and other textiles for commercial purposes that
           are cleaned without using dry cleaning solvents.
           NOTE: Dry cleaners and launderers must collect the surcharge on all items laundered or dry cleaned for
           individual consumers, including, but not limited to, shirts, jeans, and fatigues. Dry cleaners and launderers must
           also collect the surcharge from businesses on all items cleaned with the use of solvents, including, but not limited
           to, uniforms and tuxedos.

 Other exempt services are listed on the notice issued June 2, 1995.


 If you have questions regarding the notice or this supplement, please call (913) 296-0222 or write to the Taxpayer Assistance
 Bureau, Kansas Department of Revenue, 915 SW Harrison St., Topeka, Kansas, 66625-0001.



 SUPPLEMENT TO NOTICE 95-05 (6/15/95)
 TO: Dry Cleaners and Laundry Retailers
 RE: Dry Cleaning environmental Surcharge
 and Solvent Fee

Date Composed: 10/02/1997 Date Modified: 10/09/2001

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