Which local sales tax does a Kansas retailer charge when it delivers goods to a customer in a different local jurisdiction?

Plain-English summary

A retailer asked how Kansas retailers' sales tax applies to retail sales of tangible personal property delivered to a Kansas customer — specifically which local sales tax to collect.

The rule stated in the ruling. "In accordance with Kansas Administrative Regulation[,] retailers with a fixed business location in Kansas shall collect the local sales tax at their business location on retail sales of tangible personal property even though delivery of the tangible personal property may be made in another local taxing jurisdiction. In other words, the local retailers' sales [tax] that must be collected is the local tax of the retailer's place of business."

Bottom line (as of 1999). A Kansas retailer with a fixed location charged the local sales-tax rate of its own store location, regardless of where in Kansas it delivered the goods — an origin-based local sourcing rule.

Important caveat. Kansas later adopted destination-based sourcing for many retail sales (goods are generally sourced to where the customer receives them). Because this ruling states the older origin-based rule and expressly ceases to apply when the law changes, a retailer today should verify the current sourcing rules rather than rely on this statement.

What this means for you

As stated, local tax followed the retailer's location

Under the rule described here, a fixed-location Kansas retailer collected the local sales tax of its own place of business on its retail sales, even when it delivered the goods to a customer in a different city or county.

Delivery destination did not change the local rate (under the old rule)

The ruling is explicit that delivery into another local taxing jurisdiction did not shift the local tax — the retailer still collected its own location's local tax.

This is an origin-sourcing statement — confirm current law

Kansas's local sourcing rules changed after 1999 toward destination-based sourcing. This private letter ruling states the law as it then stood and, by its own terms, is superseded by later changes in the statutes or regulations. Do not rely on the origin rule today without confirming the current destination-sourcing requirements.

The state rate is not the issue here

This ruling addresses which local rate to collect. The Kansas state rate applies statewide; the question answered was purely about the local component on delivered goods.

Common questions

Q: When I deliver goods to another Kansas city, whose local tax do I charge?
A: As stated in this 1999 ruling, a fixed-location retailer charged the local tax of its own business location, not the delivery location. Note that Kansas later changed its sourcing rules, so confirm the current rule.

Q: Does delivering into a higher- or lower-tax jurisdiction change the rate?
A: Under the origin-based rule described here, no — the retailer collected its own location's local tax regardless of the delivery jurisdiction.

Q: Can I still rely on this today?
A: Not without checking. Kansas moved toward destination-based sourcing after this ruling, and the ruling expressly ceases to apply when the law changes. Verify the current sourcing rules for your sales.

Citations and references

• Kansas local sales-tax sourcing (as stated in the ruling) — a retailer with a fixed business location collects the local sales tax of its business location on retail sales, even when delivery is made in another local taxing jurisdiction. The ruling references the governing Kansas Administrative Regulation without a section number in the released text; Kansas later adopted destination-based sourcing for many sales.
• K.A.R. 92-19-59 — the regulation authorizing private letter rulings; this ruling was issued under it and binds the Department only as to the requesting taxpayer.

Source

• Landing page: Kansas Department of Revenue Policy Information Library
• Original document: P-1999-117

Original ruling text

Private Letter Ruling

Body:

Office of Policy and Research

May 21, 1999

XXXXXXXXXXXX
XXXXXXXXXXXXXXX
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Dear XXXXXXXXXXXXXXXX:

The purpose of this letter is to respond to your letter dated May 10, 1999.

You request the Kansas Department of Revenue advise you on the application of Kansas retailers’ sales tax for retail sales of tangible personal property delivered to a Kansas customer.

In accordance with Kansas Administrative Regulation retailers with a fixed business location in Kansas shall collect the local sales tax at their business location on retail sales of tangible personal property even though delivery of the tangible personal property may be made in another local taxing jurisdiction. In other words, the local retailers’ sales that must be collected is the local tax of the retailer’s place of business.

This is a private letter ruling pursuant to K.A.R. 92-19-59. It is based solely on the facts provided in your request. If it is determined that undisclosed facts were material or necessary to an accurate determination by the department, this ruling is null and void. This ruling will be revoked by operation of law without further department action if there is a change in the controlling statutes, administrative regulations, revenue rulings or case law that materially effects this determination.

Sincerely,

Mark D. Ciardullo
Tax Specialist

MDC

Date Composed: 05/27/1999 Date Modified: 10/11/2001

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